Specialty chemicals maker
American Vanguard Corp.
) has completed its equity investment in life sciences company,
TyraTech, Inc. The company has invested $3.7 million to clinch a
29.46% stake in TyraTech.
The investment achieves a major goal through the expansion of
American Vanguard's participation in the development of products
derived from natural sources and penetration of such technologies
in non-agricultural markets.
American Vanguard's strategic investment follows the formation of
a joint venture - Envance Technologies, LLC - in Dec 2012.
American Vanguard, through its fully-owned unit Amvac Chemical
Corporation, cut a joint venture pact with TyraTech.
Under the deal, the entities agreed to jointly develop and market
pesticide products that feature TyraTech's Nature's Technology.
The technology ensures the delivery of products with highest
level of efficacy and safety. The collaboration agreed to market
the novel pesticide products and technologies in the consumer
household and lawn and garden retail markets globally.
Envance Technologies, in which Amvac holds a majority stake, has
already launched its first commercial product line - Terminix
Ultimate Protection - currently available at a major U.S. retail
home improvement chain. The global market opportunity for such
products has been forecast to be between $3.5 billion and 4.5
billion a year.
The joint venture will also develop new combinations with
synthetic compounds leveraging TyraTech's proprietary Extend
Technology. This will help in improving efficacy and
environmental impact on an array of crops, providing Amvac with
fresh growth opportunities globally.
The agreement allowed TyraTech to retain all rights to use its
technology in the human and animal health markets along with
other specific consumer markets. Amvac, on the other hand, have
access to TyraTech's screening platform which is used to identify
synergistic combinations of natural compounds.
TyraTech has developed a number of products that have been proven
effective as mosquito, fly, flea and tick repellents, head lice
control treatments and intestinal parasitic control agents.
Several of these products are expected to be marketed during this
year and 2014. The global market for such applications has been
estimated to be $8 billion- $10 billion annually.
American Vanguard makes specialty chemical products for
agricultural and commercial applications. The company develops
and markets an array of chemicals, including insecticides,
fungicides and herbicides, for crops, human and animal health
American Vanguard reported solid fourth-quarter 2012 results last
month with profit surging 77% year over year to $11.3 million on
the back of continued strong market demand for its products.
Earnings of 39 cents a share beat the Zacks Consensus Estimate by
4 cents. Revenues jumped 28% year over year to $104.3 million,
beating the Zacks Consensus Estimate of $101 million.
American Vanguard is optimistic about 2013 and feels that it is
well placed to meet the increasing demand for soil insecticides
by maintaining full production of its products and proprietary
equipment systems. The successful roll out of American Vanguard's
herbicide co-marketing program with
) is also expected to support its results.
American Vanguard currently carries a Zacks Rank #3 (Hold).
Other companies in the specialty chemicals industry with a
favorable Zacks Rank are
Prospect Global Resources, Inc.
). While Balchem holds a Zacks Rank #1 (Strong Buy), Prospect
Global retains a Zacks Rank #2 (Buy).
AMER VANGUARD (AVD): Free Stock Analysis
BALCHEM CP CL-B (BCPC): Free Stock Analysis
MONSANTO CO-NEW (MON): Free Stock Analysis
PROSPECT GLOBAL (PGRX): Free Stock Analysis
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