Adecoagro Captures Gains From Land Transformation
Adecoagro S.A. (NYSE: AGRO, Bloomberg: AGRO US, Reuters.
AGRO.K), one of the leading agricultural companies in South
America, announced today that on November 30, 2011, it
completed the sale of "La Alegría" farm, located in General
Villegas, province of Buenos Aires, Argentina, for a total
price of $13.7 million. The selling price of this farm was
23.0% over Cushman & Wakefield's independent appraisal dated
September 2011 of $11.2 million.
Investor Relations Department
La Alegria is a 2,438 hectare farm purchased by Adecoagro in
2007 for a total of $5.9 million or
$2,420 per hectare. The farm was used for cattle grazing by
the former owner. Following the initial acquisition,
Adecoagro applied its sustainable production model to La
Alegria to transform a total of 1,948 hectares for the
production of soybean, corn and wheat. After four years of
enhancing the productivity of the soil by applying no-till
farming, crop rotation, balanced fertilization and other best
practices, the farm was sold for $13.7 million, equivalent to
$5,623 per hectare, obtaining an internal rate of return of
23.2%. This transaction will generate approximately $8.9
million of operating profit for the fourth quarter of
During the last six years, Adecoagro has been able to
capitalize gains of over $103.6 million by strategically
selling at least one of its fully mature farms per year.
Monetizing a portion of its land transformation gains each
year allows Adecoagro to redeploy its capital efficiently and
continue expanding its operations by acquiring land with high
Adecoagro believes that the consistent development and sale
of farms like La Alegria evidences Adecoagro's ability to
continue generating shareholder value through its land
transformation activities and sustainable production model.
Adecoagro is a leading agricultural company in South America.
Adecoagro owns over 295 thousand hectares of farmland and
several industrial facilities spread across the most
productive regions of Argentina, Brazil and Uruguay, where it
produces over 1 million tons of agricultural products
including corn, wheat, soybeans, rice, dairy products, sugar,
ethanol and electricity among others.