Farmers Edge Inc., a firm that uses artificial intelligence to help growers boost crop yields, is seeking to raise about C$100 million ($79 million) in an initial public offering to strengthen its finances and repay debt.
The Winnipeg, Manitoba based startup plans to sell a 16% stake and price its shares at between C$10 and C$17 each, according to documents filed Tuesday with Canadian regulators. Farmers Edge will list on the Toronto Stock Exchange under the symbol “FDGE”. The firm’s key backer, Fairfax Financial Holdings Inc., will remain a major shareholder, holding a 65% stake after the sale, filings show.
The IPO comes as the agriculture industry is showing heightened interest in harnessing technology to improve crop yields, curb greenhouse gas emissions and tackle climate change, drawing interest from both startups and established firms such as Bayer AG and Deere & Co.
Farmers Edge employs technology to collect and analyze local weather, soil moisture and satellite data to help farmers improve crop efficiencies and yields. Chief Executive Officer Wade Barnes co-founded the firm in 2005 and it has since expanded operations across Canada’s Prairie provinces and abroad, with offices in the U.S., Australia, Russia, Brazil and Ukraine.
“A digital awakening is happening in agriculture, similar to the disruption which has forced other sectors of the economy to change their old business models,” Barnes said in the filing. “We believe Farmers Edge is one of the few companies equipped to be a catalyst for this change.”
Farmers Edge named Munich Re, Hudson Insurance Group, Sumitomo Corp. and Google as among its commercial partners, according to its filing. More than 3,000 growers used the firm’s products and covered more than 23 million acres across six countries as of the end of last year, the firm said. Farmers Edge estimates total revenue for last year was about C$46 million, up from C$14.4 million in 2017.
National Bank of Canada and Canadian Imperial Bank of Commerce are leading a group of five investment banks on the sale, and have an option to acquire an additional 15% of the offering.
[Photo: Wade Barnes, chief executive officer and co-founder of Farmers Edge. Photo credit: Christinne Muschi/Bloomberg.]