By Ana Mano
SAO PAULO (Reuters) - A unit of Norwegian plant nutrition company Yara International (OTC:YARIY) ASA has acquired for an undisclosed sum a 14% stake in Brazilian online farm products trade platform Orbia, majority owned by Germany's Bayer AG (DE:BAYGN).
The move, formally announced after the parties secured approval from Brazilian antitrust authorities for the deal, comes as Yara aims to derive 25% of its sales from online channels by 2025, Yara Americas Vice President Cleiton Vargas said in an interview.
"Orbia was a perfect fit," Vargas said.
Orbia's CEO Ivan Moreno said Bayer (OTC:BAYRY) and Brazil's Bravium were equally diluted to accommodate Yara as a partner, with the German company now owning 68.8% of Orbia and Bravium holding a 17.2% stake.
Orbia believes a new generation of younger farmers will increasingly buy inputs online and wants to capitalize on it.
Moreno said Yara's investment in Orbia, which also gives it a seat on its board, will allow the company "to take a leap forward."
"Yara's presence as a partner highlights the credibility of Orbia's business model," Moreno said.
On Orbia's marketplace farmers can buy seeds, fertilizers and pesticides. They can also trade in soy, corn and coffee.
The company projects sales on Orbia will more than triple to 3 billion reais ($580.5 million) this year from 2021, Moreno said.
After testing waters in Brazil, a major producer of agricultural commodities including soy, coffee and sugar, Orbia expanded operations into Argentina, Mexico and Colombia.
In Brazil, the platform has some 190,000 registered farmers.
($1 = 5.1682 reais)