Soros Bets the Farm

Date: Friday, January 14, 2011
Author: DealBook

An agriculture company backed by the billionaire George Soros on Thursday filed to go public in an offering of more than $400 million.

The company, Adecoagro, based in Luxembourg, but with extensive farm holdings in South America, is selling 21.4 million common shares, and its investors are offering another 7.14 million. The shares are expected to be priced at $13 to $15. Adecoagro has applied to list the shares on the New York Stock Exchange under the ticker AGRO.

The filing also said that one of its investors, the Al Gharrafa Investment Company, which owns 6.5 percent of Adecoagro, has agreed to buy $100 million of shares if the proceeds of the offering are more than $400 million. Al Gharrafa Investment is a unit of Qatar Holding, an investment vehicle of the Persian Gulf emirate.

A Soros affiliate owns 34 percent of Adecoagro.

“We believe we are one of the largest owners of productive farmland in South America,” the company said. “As of September 30, 2010, we owned 274,663 hectares (excluding sugarcane farms) of farmland in Argentina, Brazil and Uruguay.”

Adecoagro says it plans to use $230 million from the offering and the Al Gharrafa deal to finance the construction a new sugar and ethanol mill in Ivinhema, Brazil. Another $145 million will be used to acquire farmland and expand the business.

Credit Suisse, Morgan Stanley and Itau of Brazil are the global coordinators for the offering. Deutsche Bank is the bookrunner, while Banco do Brasil Securities and Rabo Securities are co-managers.