CMGP: CPCM, Agrosem... these new subsidiaries aimed at boosting the group's growth

Since 2018, every acquisition made by CMGP has been part of a strategy to consolidate a one-stop-shop model for Moroccan agriculture. Following the acquisitions of Philea in the phytosanitary sector, CAS in 2021 for irrigation, Delta Irrigation, and more recently Agrosem for seeds, the acquisition of CPCM marks a significant step in building this integrated ecosystem, stated the group's CEO, Youssef Moamah, on October 7 during the presentation of the semi-annual results. The CPCM acquisition aligns with the group's strategy initiated in 2024, addressing several strategic criteria. It strengthens CMGP's positioning in the agricultural segment—particularly in phytogenetics and high-value fertilizers—while also diversifying into new areas outside agriculture, such as water treatment and industrial chemistry. CPCM, recognized for its solid industrial base, has a diverse product portfolio: 75% of its revenue comes from the agricultural segment, with over half from phytogenetics, 20% from biostimulants and growth correctors, and 10% from applied chemistry in industries like paper, paint, textiles, and ceramics, with the remainder from water treatment. With this acquisition, CMGP enhances its expertise in the Moroccan phytosanitary market, becoming the leading operator with a consolidated market share of nearly 23% and a combined revenue of approximately 740 million dirhams in this segment, compared to 480 million dirhams for CMGP alone. Overall, CPCM's revenue in 2025 is estimated at 500 million dirhams, bringing CMGP's consolidated revenue (excluding synergies) to nearly 3 billion dirhams. The combination of CMGP Group's and CPCM's expertise is expected to generate significant industrial and commercial synergies, particularly with export opportunities. CPCM brings a unique industrial capacity, being the only local player producing phytosanitary products in Morocco, a key advantage in a market largely dominated by imports, noted Younes Al Abadan, Deputy General Manager of Finance and Corporate Development. This integration will allow CMGP to combine the specialties of its subsidiary Philea with CPCM's generics while optimizing its distribution network and supplier relationships in Europe and Asia. Industrially, CMGP will leverage CPCM's technical know-how to enhance its local production capabilities, reduce supply costs, and share sites and infrastructure. Commercial synergies will result in an expanded client portfolio and increased presence in rural and peri-urban areas, providing solutions that cover the entire agricultural value chain. Additionally, CPCM has solid experience in public markets, particularly with ONEE, a position CMGP intends to capitalize on. Financially, the acquisition will be financed with 700 million dirhams in debt, with the remainder in equity, while maintaining a controlled accounting gearing around 37%. This allows CMGP to retain a comfortable margin for potential complementary operations ranging from tens to hundreds of millions of dirhams. However, management has indicated that if larger opportunities arise, they will not hesitate to access the market. Beyond agriculture, CPCM opens new market access for CMGP, particularly in potable and industrial water treatment, as well as chemicals for industry. These segments are expected to eventually represent 10 to 15% of the group's revenue, contributing to its diversification strategy. Agrosem: the other growth driver After acquiring a stake in Agrosem in 2024, CMGP plans to increase its ownership in this subsidiary from 40% to 70% by the end of the year. Agrosem is experiencing significant growth, with a revenue of 74 million dirhams in the first half of 2025, equivalent to its total revenue for 2024. The subsidiary's revenue is projected to reach 114 million dirhams for the entire 2025 fiscal year, with a net profit of 17 million dirhams, compared to 11 million dirhams in 2024. Management anticipates rapid growth for this subsidiary in the medium term. They also emphasize that the integration of CPCM and Agrosem will be one of the main challenges for the 2026-2027 fiscal years, with synergies to be activated across operational, industrial, commercial, and sourcing aspects.