• A growing market, driven by the low but growing penetration of foliar fertilizers in Brazil and an attractive cost-benefit proposition for farmers.
• A highly fragmented market, which provides a less competitive field and opportunities for highly accretive add-on acquisitions.
• The company’s strong product portfolio, focused on high value-add plant nutrition, further reinforced by in-house lab services.
• Three strong brands to serve different market segments, providing broad market access.
• The opportunity to expand the company’s market share by upgrading its commercial capabilities
• Industry-leading margins with best-in-class R&D
• Attractive exit opportunities, driven by the growth trends of the market and strategic relevance of high-value foliar fertilizers for agribusiness companies.

Aqua’s approach to Fertiláqua combined efforts in both changes in the portfolio of products and marketing strategy as well as expansion in geographical reach and M&A. Moreover, the introduction of a robust value capture system that linked R&D, commercial access and marketing strengthened Fertiláqua’s ability to defend margins and establish durable relationships with large retailers. In summary, the value creation levers include:

• Professionalization
  • Hired an experienced management team, which was considered critical in the sale of the company
  • Established a robust management system, a winning culture and solid ESG standards
  • Full transparency of accounts receivables, channel inventories to minimize day-after issues
• Growth:
  • Organic growth of ~17% CAGR_13-20
  • Inorganic growth through the strategic acquisitions at attractive multiples:
    • Dimicron (2015): consolidated brand in the South of Brazil
    • Spray Farm (2017): accelerated entrance into the fast-growing and high-margin sugarcane segment
  • Ebitda margin expansion of +3.5pp in the period with the continuous launch of next generation products and new product lines
  • Formed a highly technical and consultive sales team with over 160 members covering all productive regions in Brazil
• Transformation:
  • Transition from selling products to selling complete crop nutrition solutions
  • Launched 38 new technologies in 2019/20 season, ~10x higher than 2014/15
  • Improved client mix: By 2020, the company had 11 clients with more than 4m BRL in sales, vs. only one in 2015
  • Developed a direct sales channel and expanded in new crops (F&V, coffee and sugarcane), diversifying from soybean
  • R&D scale up with 5 strategically located research facilities
• Impact
  • Great Place to Work 2019: 95% of the employees were proud to tell other people that they work at Fertiláqua
  • Recognized by LAVCA as an environmentally and socially responsible company, given its strong E&S management system
  • Strict guidelines and continuous improvement were instrumental for Fertiláqua’s successful ISO 14.001 and 001 certifications

• On January 7, 2021, Fund I, together with co-investors and minority shareholders, sold 100% of the shares of Fertiláqua to ICL Group, is a sophisticated strategic player, listed on the NYSE
• Aqua’s PGTS approach was critical in driving value creation and the highest multiple in industry: company was sold at a multiple substantially higher than peer companies in the period
• Overall, Aqua’s investment in Fertiláqua resulted in a gross MOIC of 3.7x since its initial investment in Aminoagro
• Aqua’s 3.7x Exit MOIC is composed of:
  • 1.0x Entry MOIC
  • 2.1x due to organic growth (margin expansion of ~17% organic revenue CAGR13-20  coupled with 3.5p.p Ebitda margin expansion)
  • 0.5x due to inorganic growth
  • 1.7x due to multiple expansion – Avg. entry @ 6.2x Ebitda and exit @ 10.0x Ebitda
  • -1.6x in Leverage and other effects