Adecoagro set for majority stake acquisition by Tether Investments

LUXEMBOURG - Adecoagro S.A. (NYSE: AGRO), a prominent South American sustainable production company with a market capitalization of $1.12 billion, is poised to have a significant change in its shareholder structure. Tether Investments S.A. de C.V., part of the Tether Group, has initiated a tender offer to acquire a majority stake in Adecoagro. The offer, unanimously approved by Adecoagro’s Board of Directors, proposes the purchase of up to 49,596,510 Common Shares at $12.41 each, representing a premium to the current trading price of $11.15. According to InvestingPro analysis, the company currently trades below its Fair Value, suggesting potential upside for investors. This transaction would increase Tether’s ownership to approximately 70% of Adecoagro’s outstanding Common Shares, contingent on acquiring at least 51% of the shares on a fully diluted basis.

Mariano Bosch, Co-Founder and CEO of Adecoagro, expressed enthusiasm about the partnership with Tether, highlighting the alignment in entrepreneurial spirit and the support for technology adoption within the company’s operations. The company’s strong financial position, evidenced by a healthy current ratio of 2.54 and impressive revenue growth of 16.94% over the last twelve months, supports management’s confidence. Bosch emphasized the transaction’s respect for minority shareholders and his decision not to sell his shares unless necessary to advance the deal.

Emilio Gnecco, Adecoagro’s CFO, noted that Tether’s involvement would enable the company to pursue a more ambitious growth plan, building on its consistent performance and positioning for long-term sustainable growth.

Paolo Ardoino, CEO of Tether, stated that the investment reflects Tether’s commitment to backing sustainable, future-oriented companies, praising Adecoagro’s track record in innovation across the South American food and renewable energy sectors.

Financial advisory for the transaction is provided exclusively by J.P. Morgan, with legal counsel from Davis Polk & Wardwell LLP and Elvinger Hoss Prussen for Adecoagro, and McDermott Will & Emery LLP for Tether.

The tender offer has not yet commenced, with further details to be made available through the Offer to Purchase and related materials, which will be accessible to Adecoagro’s stockholders without charge and filed with the SEC in due course.

This announcement is based on a press release statement and contains forward-looking statements subject to various factors and uncertainties that could alter actual results. Adecoagro advises against undue reliance on these statements, which do not reflect current or historical facts and may change over time. For comprehensive analysis and detailed insights about Adecoagro’s financial health, valuation, and growth prospects, investors can access the full Pro Research Report on InvestingPro, which covers over 1,400 US stocks with expert analysis and actionable intelligence.

In other recent news, Adecoagro S.A. reported its fourth-quarter 2024 earnings, surpassing analyst expectations with an earnings per share (EPS) of $0.4585, compared to the forecasted $0.4085. Revenue also exceeded projections, reaching $368.51 million against an anticipated $348.33 million. The company’s strong performance was attributed to record sugar and ethanol production, with a consolidated adjusted EBITDA of $444 million for the year. Adecoagro is also engaged in discussions with Tether Investments S.A. de C.V. for a potential buyout at $12.41 per share, aiming for Tether to acquire a 51% stake. The exclusivity period for these negotiations has been extended through March 2025, though no definitive agreement has been reached yet. Furthermore, Adecoagro’s board has engaged legal and financial advisors to evaluate the proposal’s terms. Analysts from UBS and Itau BBA have shown interest in the company’s operational strategies, especially in sugarcane crushing and ethanol production. Despite the ongoing negotiations, Adecoagro continues to focus on enhancing shareholder value and maintaining operational efficiency.

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