Banco Santander takes 5% stake in Kimitec to help farmers and agribusiness switch from chemical to natural
Santander has acquired a 5% stake in Grupo Kimitec and its MAAVi Innovation Centre, the largest natural biotech hub in Europe. The bank’s holding, secured through the fund Fondo Agro Smart, is part of its strategy to help innovative, sustainable companies with high growth potential.
Since the Green Deal and the EU Farm to Fork strategy were approved, Spain’s Kimitec, which saw 80% higher turnover last year, has been known as a key company in making agribusiness more sustainable in Europe.
Santander España’s CEO, António Simões, says, “It’s a strategic deal for Santander. Not only are we entering the biotech industry; we’re [entering] alongside one of scaleups with the greatest chances of becoming the most profitable unicorn in the years to come. With this agreement, we will add value to our portfolio of agribusiness customers”.
According to Kimitec CEO Félix García, “At MAAVi Innovation Centre, we have a vision: changing the way food is produced. The current production model has met its end. In a moment marked by calls in the EU to cut synthetic chemicals, supermarket chains talking about zero waste, and more uncompromising consumers with growing concerns about health and sustainability, agribusiness is forced to transform. We were able to get ahead of this situation and, for over 15 years, [we’ve] been uncovering the power of nature to succeed in this challenge for a different, nature-inspired production model”.
In fact, Kimitec and the MAAVi Innovation Centre have closed several deals with Bollo, GS España, Pescanova and other leading companies, as well as with such agrochemical giants as UPL, which made the MAAVi Innovation Centre a strategic partner in its transition to a natural production model. Kimitec is also the only company in its sector with 5 EU Horizon projects, given its strategic capacity to steer agribusiness from chemicals to natural production methods.
From agriculture the Spanish scaleup has leaped into aquafarming, livestock (antibiotic substitutes in animal medicine and higher productivity) and other sectors, while aiding agribusinesses transition from chemicals to natural techniques. Its long-term plans include entering cosmetics (substitutes for pigments and active ingredients) and pharmaceuticals (substitutes for active ingredients).
The MAAVi Innovation Centre creates value for agribusinesses in three major ways: eliminating waste in raw material production (removing chemicals traced to their products); helping them obtain E-number clean labels (for food additives); and raising the cost of subproducts that harm the environment and companies’ bottom line.
With Santander’s equity stake, the Almeria-based Kimitec can build on the bank’s advice to attract new customers across Santander’s footprint and expand internationally.
“In15 years of testing the concept in agriculture, we’ve come to lead the transition from chemicals to natural [products]. Now is the time for us to move on to agribusiness to achieve our purpose: changing how food is produced. Our goal with this strategic agreement with Santander is to partner with each and everyone of its agribusiness customers”, said Félix García.
Under the agreement, the two groups will work together on social projects. Kimitec’s not-for-profit organization, the MAAVi Foundation, believes diversity is a source of wealth for businesses and broader society. It builds on such values as respect, equality and loyalty to create opportunity for more than 400 children and their families in sport, education, nutrition and job placement.
Italy: EIB and Banco BPM provide EUR 500m for SMEs, mid-caps and agribusinesses
– EUR 200m each for the SME and mid-cap segments, EUR 100m to the agricultural sector
– Financing both for new and existing projects in all productive sectors
– The operation is based on the European Investment Bank’s underwriting of a reserved bond issued by Banco BPM
An agreement signed between the European Investment Bank (EIB) and Banco BPM in support of the Italian economy will make available EUR 500m in new funding to Italian small and medium-sized enterprises (SMEs) and agribusinesses.
Of that amount, EUR 200m is reserved for SMEs (up to 250 employees), EUR 200m for mid-caps (250-3 000 employees) and EUR 100m for agribusinesses, with a 10% share dedicated to “young farmers” (under 41 years of age).
The loans are intended to fund either new or existing projects providing these have not yet been completed. Loans to businesses operating in all productive sectors (agriculture, crafts, industry, retail, tourism and services) can be allocated for the purchase, construction, extension and refurbishment of buildings; the purchase of plant, equipment, vehicles or machinery; expenses, additional charges and intangible assets related to the projects, including research, development and innovation costs; and ongoing working capital requirements for operational purposes.
In terms of the structure of the operation, the EIB is underwriting, in a private placement, a new covered bond issued as part of the BPM Covered Bond 2 programme, backed by a portfolio of residential mortgages established pursuant to Italian law on covered bonds. The covered bond issued by Banco BPM has a term of six years with repayment of principal on maturity and an annual fixed coupon rate of 0.5%. In turn, Banco BPM will transfer EUR 500m in new funding with a financial benefit (tax reductions) for businesses that apply for project financing.
Banco BPM will manage the financing applications, disbursements and repayments through its network of subsidiaries. The loans can have maturities of up to 12 years.
EIB Vice-President Dario Scannapieco stated: “I am particularly pleased with this partnership with Banco BPM. It is allocating funds very rapidly, which shows that by working together with a large Italian bank the EU can help individuals and businesses, including agribusinesses, to revive the economy.”
Banco BPM’s CEO Giuseppe Castagna said: “This operation consolidates our existing strong relationship with the EIB, which represents a significant chapter in Banco BPM’s continued backing for Italian businesses. To date, loans disbursed under agreements with the EIB have enabled us to support more than 2 200 SMEs via investments amounting to over EUR 1bn. I am very satisfied that a substantial share of the total amount provided under this specific agreement is intended for agribusiness, a sector in which Banco BPM represents a benchmark for many enterprises and in which we intend to keep growing.”
The operation was overseen for Banco BPM by our in-house legal team with the support of A&O. For its part, the EIB was assisted by BonelliErede.