Royal HZPC acquires IPM Potato Group

Name of the deal:           Royal HZPC acquires IPM Potato Group
Date announced:            Announced 3 October 2025. Subject to customary closing conditions and approval by the competition authorities
Date closed:                      Announced 3 October 2025. Subject to customary closing conditions and approval by the competition authorities
Published value:             EUR 10-50m
Buyer(s):                            Royal HZPC
Target:                                 IPM Potato Group
Seller:                                  Donegal Investment Group

Involved firms and advisors
Involved firms and advisors buy side:
Squarefield, M&A Advisory
Deloitte, FDD & Tax Advisory
DLA Piper, Legal

Involved firms and advisors target: n/a

Involved firms and advisors sell side:
Davy, Hayes

Pitch

Deal Outline
Royal HZPC Group has announced the acquisition of IPM Potato Group, an Irish company specialized in breeding, production, and export of seed potatoes. With this strategic move, the Dutch group strengthens its global position in the sector, expands its production area in the United Kingdom, and consolidates its international market presence

Why This Deal Should Win the Award for Best Deal Small-Cap 2025
About Royal HZPC Group
Royal HZPC Group, founded in 1898 and headquartered in the Netherlands, is an international market leader in potato breeding, seed potato trading and product concept development. HZPC is owned by an association of active and former seed potato growers (certificate holders), and offers innovative potato varieties that are optimised for local growing conditions. The business also shares expertise and solutions that relate to the climatic, cultural and commercial challenges facing the food industry. With c. 400 employees in 16 different countries and with exports to more than 90 countries, HZPC makes a significant contribution towards the availability of responsible food and the well-being of millions of people worldwide.

About IPM Potato Group
IPM Potato Group, founded in 1950 and headquartered in Ireland, is Ireland’s market leader in seed potato breeding, production, and export. IPM Potato Group is also the largest exporter of exclusive and protected varieties in the United Kingdom. Through a strong grower network in Ireland, Scotland, France, the Netherlands, and England, IPM Potato Group exports to 40 countries with a strong focus on the Mediterranean region.

Here’s why the acquisition of IPM Potato Group by Royal HZPC deserves recognition as the Netherlands’ Best Smallcap Deal of 2025:
First, it elevates a world leader that most people have never heard of. Royal HZPC isn’t a household name, yet it is the global market leader in seed potato genetics (1 out of 10 potatoes consumed globally are HZPC varieties). As such HZPC has a global impact on the quality and availability of food that feeds billions of people through continues development of varieties in aspects as yield, disease resistance, taste, storability, and water efficiency. HZPC is also among the frontrunners in the development of true potato seed (TPS), a transformational platform that will most likely one day distribute potato genetics as lightweight, disease-free seed rather than bulky tubers. The combination of dominance today and credible innovation for tomorrow makes HZPC a champion that is hidden in plain sight. The acquisition of IPM directly reenforces HZPC leading position today and it’s global sales and distribution network that will also enable HZPC to dominate the market for years to come.

Second, the deal’s synergy logic is unusually clean and compelling across three dimensions:

• 1,800 additional acres of seed potato production in Scotland. Scotland is a leading global seed potato region thanks to its cool climate, strong phytosanitary standards, and export reputation. Folding 1,800 acres into HZPC’s network doesn’t just add volume; it upgrades quality assurance and supply optionality in one stroke. Operationally, this strengthens HZPC’s ability to balance foundation seed, pre-basic, and basic classes across seasons, smoothing variability and lowering cost per usable hectare. Commercially, Scottish origin opens doors in premium export markets that prioritize provenance and plant health certification.
• Market position in Ireland, England, and key North African growth regions. IPM’s footprint is strongest where potato heritage and consumption are embedded in culture (Ireland and England) and where demand curves are steepening (North Africa). For HZPC, this adds immediate commercial depth: closer relationships with processors and packers in the British Isles, plus channel access and agronomic know-how in North African markets that are transitioning up the value chain from table to processing varieties. The cross-sell opportunity is straightforward trough the direct ability to also offer HZPC’s elite genetics and, over time, TPS products through IPM’s trusted routes to market will further deepen the relationship with growers, creating loyalty now and in the future.
• Variety portfolio fit (and the Teagasc pipeline). IPM’s varieties are developed in collaboration with Teagasc and bring a proven, market-tested portfolio that complements HZPC’s own genetics bench. This is not a simple “more of the same” library; it deepens trait diversity (notably late blight tolerance, earliness, and processing quality) while broadening agro-ecological fit. The immediate value is accelerated market coverage with less cannibalization; the medium-term value is an expanded R&D funnel, with dual-track breeding that blends HZPC’s genomic selection and TPS ambitions with IPM’s variety development cadence. Expect faster time-to-market for region-specific solutions and a more resilient response to climate volatility and evolving pathogen pressure.

Beyond synergy, the deal excels on strategic timing and ESG impact. Climate change is reshaping potato agronomy through heat stress, water scarcity, and disease pressure. Pairing HZPC’s R&D scale with IPM’s applied breeding, field intelligence, and Scottish acreage accelerates the dissemination of water-efficient, disease-tolerant genetics. That’s tangible food-system resilience aligned with EU sustainability goals: precisely the kind of impact smallcap champions should be rewarded for.

Financially, this is a high-return integration with manageable risk. Seed potato is a relationship business with sticky, multi-decade relationships and certification regimes that defend pricing power. The combination increases mix toward higher-priced, trait-rich varieties and mitigates volatility through geographic diversification. Integration complexity is modest: similar regulatory frameworks, shared quality systems, compatible grower networks, and a culture grounded in agronomy and service. Execution risk sits in the sweet spot for smallcap excellence: material enough to matter, contained enough to deliver.

Finally, the transaction showcases Dutch agri-innovation leadership. The Netherlands consistently punches above its weight in horticulture and seed technology. By marrying HZPC’s global genetics leadership with IPM’s portfolio, acres, and markets, this deal spotlights how Dutch giants can create disproportionate value through smallcap transactions: not through financial engineering, but through precise, science-driven evolutions that make food systems better.

In short: a stealth global champion expands its platform with perfectly targeted assets—varieties linked to a top research partner (Teagasc), premium production acreage in Scotland, and commercial strength in Ireland, England, and North Africa—advancing both today’s profitability and tomorrow’s TPS revolution. That is exactly what a “Best Smallcap Deal” should look like.

Impact of This Deal on the Company
Overall, the IPM acquisition positions HZPC for step-change growth rather than incremental expansion. In the near term, it boosts volume, revenue, margin, and market access. Over the medium to long term, it solidifies HZPC’s platform for innovation (including TPS), strengthens its resilience, and deepens its competitive moat.

Given the relative modesty of many smallcap deals, this one stands out: it doesn’t just add scale, it accelerates the core innovation engine of the business while reinforcing downstream market reach. If executed well, it could redefine HZPC’s growth trajectory and entrench its leadership in global seed potato genetics.

Impact of This Deal on Direct Stakeholders
In essence, HZPC’s acquisition of IPM creates a win-win for the operational stakeholders: growers, employees, and customers, while marking a graceful exit for Donegal’s investors. It consolidates European seed breeding under a mission-driven, farmer-owned structure, ensuring that the genetic foundations of one of the world’s most important food crops remain in the hands of those who grow it.

We have included an overview setting out the impact of the key stakeholders:

• Customers & consumers: improved supply, variety choise, and innovation speed, with limited consolidation risk
• Irish and Dutch (but also global) agrifood sectors: transfer of ownership to global cooperative ensuring that this critical role is not only money driven
• IPM employees & growers: greater resources, job security, and global reach, with limited cultural adjustment
• IPM (/ Donegal) shareholders: a cash exit and likely liquidation of Donegal, marking the end of public-market exposure and a long-lasting sell-down of Donegal’s business
• HZPC growers & employees: stronger cooperative, expanded markets, better genetics, and higher stability overall

Impact of This Deal on Society
The acquisition of IPM Potato Group by Royal HZPC has a meaningful societal impact beyond business. By combining two leading innovators in seed potato genetics, the deal accelerates the global distribution of high-yield, disease-resistant, and water-efficient varieties. Potatoes already offer one of the highest carbohydrate yields per litre of water used (far surpassing cereals such as rice or wheat), making them a vital crop in addressing world hunger and water scarcity.

HZPC’s R&D capabilities, strengthened by IPM’s varieties (developed with Teagasc) and Scottish seed acreage, enable faster breeding of climate-resilient potatoes suited to dry or marginal lands, particularly in Africa and Asia, where food security challenges are growing. This deal therefore supports more sustainable agriculture, helping farmers produce more calories with less water, fewer inputs, and lower environmental impact. In essence, it’s a smallcap transaction with a large-scale impact on global food security and sustainable resource use.

Most Complex Aspect of This Deal
The acquisition of IPM Potato Group by Royal HZPC was complex due to three key factors. First, the fundamental difference in shareholder structures: HZPC is owned by its growers and employees, focused on long-term cooperative value creation, while IPM was owned by Donegal Investment Group, a listed company. Aligning these ownership models required careful negotiation. Second, the highly seasonal nature of the potato industry meant the deal’s timing had to be precise: between growing and export cycles to avoid disrupting production, certification, and contracts. Third, the international structure of both businesses added legal and operational complexity, with subsidiaries, joint ventures, and distribution entities across Europe, Africa, Asia, and South America.