DPI-backed CMGP combines with CAS

24 Nov 2020

Development Partners International (“DPI”), a leading Pan-African private equity firm with a strong track record of investing across the continent, is pleased to announce the signing of Compagnie Marocaine de Goutte à Goutte et de Pompage’s ("CMGP") landmark combination with Comptoir Agricole de Souss (“CAS”) creating a major new player in the Moroccan and African agricultural industry with combined sales of MAD 1.6 billion.

CMGP is a leading African provider of irrigation solutions and water infrastructure headquartered in Morocco, with operations across Morocco and West Africa.

CAS is one of the leading players in the agri-supply sector in Morocco, operating in three segments: irrigation, crop protection, and seeds and fertilisers. Founded in 1967 by Phillipe Alleon, current CEO Jacques Alleon has spearheaded the expansion of the business across Morocco since joining in 1994.

The two companies have delivered strong growth over the past two decades and the highly complementary capabilities of the two businesses – both leaders in their space with around MAD 1.6bn combined sales - represents an opportunity to create a unique end to end, one-stop shop market leader for Moroccan and West African farmers, uniquely positioned to deliver sustainable long-term growth. The combined business will also deliver significant positive social impact through improving farmers’ incomes and quality of life, helping solve significant water scarcity issues, and improving agricultural sustainability and food security.

DPI first invested in CMGP in 2018, supporting the business in diversifying its product range and expanding its geographical footprint in Africa. The investment was the largest private equity transaction announced in Morocco that year. As part of this transaction, DPI has committed additional capital into CMGP and is delighted to welcome AfricInvest as a new shareholder in the enlarged company.

Sofiane Lahmar, DPI Partner, said, “Agriculture in Morocco employs about 40% of the nation's workforce and remains one of the main drivers of growth for the economy, contributing around 14% to GDP. Through the combination of CMGP and CAS, we will be able to further diversify the business’ operations, accelerate its growth in Morocco, and further expand its footprint across Africa. This combined business will benefit from a unique value proposition and strong distribution which we believe will deliver impressive growth in Morocco and across West Africa. We are thrilled to support this key milestone for CMGP and look forward to working with Youssef, Jacques, and the CMGP and CAS teams on implementing this new and exciting strategy and vision.”

Youssef Moamah, CEO, CMGP, commented, “Today's announcement is an important moment for our companies: CMGP and CAS, together, will be the leading player in Morocco with a unique model in irrigation, agro-inputs and water infrastructure. This will be facilitated by the fact that CMGP and CAS have similar corporate cultures sharing the same values of excellence, integrity and caring for their employees, customers and the wider ecosystem.”

Jacques Alleon, CEO, CAS, commented, “This is a day of celebration and pride for us all - the combination of our two highly complementary companies will create the reference for the Moroccan and African farmer in agriculture and water, providing significant growth opportunities, enabling us to become better partners for our customers and suppliers, and offering better development opportunities for all our employees.”

The transaction is subject to customary approvals including regulatory approvals and is expected to close in Q1 2021.

Smyle Finance, Derenia Capital, Naciri & Associés Allen & Overy, PwC, and the Boston Consulting Group advised CMGP and its shareholders on the transaction. ENDS

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