CropLogic has cancelled an acquisition hailed as its first foothold in the Australian market.
The Kiwi soil tech business (ASX:CLI) was supposed to buy Tasmanian agronomy services company Ag Logic for $320,000 in cash and scrip.
The deal was to form the basis of an HQ move to Australia, a shift which resulted in former managing director Jamie Cairns quitting in order to remain in New Zealand.
Ag Logic’s Reuben Wells told Stockhead they both agreed to end the deal because his company didn’t fit into CropLogic’s new plan for growth as under their old strategy.
“It didn’t make as much sense given where CropLogic was going,” he said.
“We both agreed that would be silly to go ahead.”
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CropLogic appears to have moved away from a growth-by-acquisition strategy backed by in-house research.
It now wants to takes advantage of partnerships to sell its soil-testing product.
“Ag Logic’s revenue comes from a wide range of product types, utilising expertise both in soil moisture management through monitoring and irrigation, and in precision agriculture, such as drainage planning and variable rate input advice,” CropLogic said.
“Unfortunately, Ag Logic’s broad product offering does not complement CropLogic’s revised Commercialisation and R&D Strategies.”
CropLogic confirmed to Stockhead that is still moving its HQ to Australia.
A company spokesman said the company was reviewing “a number” of strategic joint venture opportunities that could be part of CropLogic‘s first step into Australia.
CropLogic’s share price is yet to attain the 20c issue price heights at which it was sold pre-IPO in September last year.
On Wednesday morning it was trading at 3.7c. The all-time low is 3.6c.