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ArborGen Poised for Growth with Acquisition of CellFor's Varietal Business Integration of additional
products will enhance ArborGen's ability to provide advanced genetic solutions
to the forestry industry.
ArborGen, the world leader in the development and commercialization
of technologies that improve the productivity of trees, and the world's
largest provider of loblolly pine seedlings, today announced the completion
of its acquisition of the primary assets of CellFor Inc., a leading
supplier of elite varietal pine tree seedlings to foresters in the United
States and South America.
"The ability of advanced genetics to improve the profitability of our
commercial forestry customers is now a matter of fact," said Andrew
Baum, president and chief executive officer of ArborGen. "With the acquisition
of CellFor's varietal pine assets, we are the best positioned company
to provide those genetics to the forestry industry.
"The integration of CellFor into ArborGen strengthens our leading position
in the key U.S. pine market by allowing us to introduce a broader base
of pine varietal products at lower cost. More importantly, merging CellFor's
technology with our own will enable us to bring these highest value
varietal products to market in volumes earlier than we had anticipated
under our previous business plan," added Baum, who noted a further positive
is that the acquisition will enable ArborGen to take these superior
varietal products into South America, where CellFor already has extensive
varietal plantings, as well as into the large China forestry market
where there is a substantial and growing wood fiber deficit.
A successful pine varietal program requires both the development of
a propagation platform to make many millions of identical copies at
a low cost, and an extensive trial program from which to make commercial
selections. Until now, ArborGen and CellFor have been separately working
to develop these two elements. Bringing these efforts together will
provide many areas of synergy, including a much wider portfolio of varietal
genetics with an expanded geographic reach, a reduction in future development
costs and the integration of the very best of two technology development
programs.
ArborGen is well positioned to leverage CellFor's assets given:
CellFor was the world's leading developer of varietal loblolly pine.
The company had invested more than $140 million over 12 years to develop
its technology and products, and had demonstrated both the value of
varietal pine products to foresters and the ability to produce these
products at scale. "CellFor's varietal products complement our own,
and allow us to immediately offer a full range of varietal products
across the entire loblolly planting region," noted Baum.
"An immediate impact of this acquisition is that it gives our existing
and prospective customers in the United States and South America even
more choices when it comes to our products," said John Pait. "We have
nearly 20 years of data and more than 78,000 acres of forests in the
United States and South America that underscore the benefits of these
products to landowners and commercial foresters, including improved
productivity, disease resistance and log quality characteristics that
can maximize the value of their timber crops. We are already talking
to our customers about our expanded product capabilities, and we are
confident of the immediate potential for growth within our current base.
We will have initial quantities of CellFor's varietal seedlings for
sale in the 2012-13 season and we are planning for full commercialization
the following year."
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