French cooperative InVivo has plans to manufacture bread as part of its strategy to expand into new avenues following the divestment of its animal nutrition unit, Neovia.
It also plans to make significant investments in farming technologies in order to grow in the pesticide-free food market.
InVivo is a group of approximately 200 farmer-owned cooperatives.
The cooperative is selling Neovia to US-based agribusiness firm Archer Daniels Midland for around $1.1bn. This transaction is expected to be completed in the first quarter of 2019.
Neovia contributed two-thirds of the cooperative’s core earnings before interest, tax, depreciation and amortisation (EBITDA ) of €163m in the fiscal year 2017/18 ending 30 June. In the previous financial year, EBITDA was €133m.
With the trading of grains becoming less profitable, InVivo is exploring avenues to develop other cereal products such as bread, with a focus on entering the Asian market.
Speaking to reporters, InVivo chief executive Thierry Blandinieres said: “Asia is going to be the boom region for wine and for bakery goods.”
InVivo is also trialling a French food outlet in Singapore called So France.
Since 2014, the firm has embarked on an overhaul strategy, which has seen the cooperative expand its retail network, reduce its grain trading and enter into wine distribution.
Following the sale of Neovia, the cooperative plans to boost EBITDA within four years, supported by its Bioline farming division and food chain expansion.
According to Blandinieres, Bioline will make use of digital tools and natural pest control methods in the production of pesticide-free food.
InVivo’s group sales totalled €5.2bn in 2017/18, compared to €5.5bn in 2016/17.
