Agricultural inputs firm Vegalab is now in produce marketing, having acquired M&G Packing and planning to market citrus and more in the coming years.
“That was something we always had in mind as an option because since we manufacture agrochemicals we are in touch with growers,” said CEO David Selakovic.
The purchase of Fresno, Calif.-based M&G Packing included about 11 acres of property with about 30,000 square feet of buildings. The deal also encompassed inventory, equipment, customers, suppliers and contract rights, according to a news release. M&G has been packing mainly oranges and lemons for about 13 years.
Vegalab plans to develop a new label to market the citrus, which it expects to export mainly to South Korea and Japan, where Selakovic said growers can get top dollar for their fruit. The transition to the new brand will take place in 2018.
The company expects to market more commodities in the coming years, likely including almonds and kiwifruit because it has relationships with growers in those deals.
“M&G has about 11 acres and I believe about a quarter of that is used, so we have a lot of room for expansion,” Selakovic said.
Since the acquisition, Vegalab has hired 15 more people to work in the packinghouse in hopes of increasing the production capacity, The company is also working on updating the equipment there.
It remains to be seen whether the growth of Vegalab’s nascent produce business will include more acquisitions.
“We’re open to all the options,” Selakovic said. “We’re quite a small company and in that way we’re very agile and we can make decisions very quickly and move in different directions when that makes sense.”
Vegalab markets its products as alternatives to synthetic inputs, and some of them are certified organic for use in the U.S.
“We believe this acquisition will produce tremendous synergies between our packing business and our all-natural agrochemical business,” Selakovic said in the news release announcing the deal. “By seamlessly integrating the entire process from planting to packaging; by supplying growers with products that increase their yields of premium quality fruits; by packing their fruits efficiently; and by giving them access to our network of international buyers who pay the highest prices for premium quality citrus, we expect to grow both businesses rapidly.”