Land O'Lakes invests in Villa Crop Protection, a South African farm chemical company

Land O'Lakes Inc. is making its first commercial investment in Africa by partnering with a South African company. The Arden Hills-based cooperative will announce Tuesday that it has purchased a 52.5 percent ownership stake in Villa Crop Protection, a leading farm chemicals company based in Johannesburg.

Land O'Lakes CEO Chris Policinski said the deal reflects the cooperative's accelerated growth in its international business.

"We believe Africa is going to be, at some point in the relatively near future, everybody's great growth market," Policinski said in an interview. "There's an emerging middle class and developing economies on the continent. South Africa is the most developed of all the countries in terms of ag infrastructure, and a good place to start."

Policinski said Land O'Lakes has worked on agricultural development projects in Africa and elsewhere for the past four decades, mainly in conjunction with U.S. government-funded programs but not in an ownership role.

He said the new partnership will bring products and expertise from the WinField Solutions subsidiary of Land O'Lakes to complement the farm chemical formulations that Villa Crop Protection has already developed, registered and sold in South Africa.

The changes will not mean layoffs for either organization, officials said, and Villa's existing management team will still lead the business with $150 million in annual sales.

In addition to chemicals aimed at specific needs of farmers in South Africa, Villa Crop Protection operates Villa Academy Training Institute, which equips producers and salespeople with the latest knowledge and experience about using farm chemicals to optimize crop production.

Schreuder said he also plans to expand the institute to build farmers' skills and spur economic development in the ag industry as a whole in Africa.

Villa operates Fountain Chemicals, a product formulation factory halfway between Johannesburg and Pretoria. The company also owns a warehousing facility just outside of Cape Town.

Policinski said he expects the partnership will add value and increase earnings for Land O'Lakes "very quickly" and will become a platform to grow northward on the continent in the future.

"Over the next five, seven, 10 years, we could see a lot of growth in agriculture as farmers there need advice on how to grow things in an increasingly productive and sustainable way to feed a growing middle class," he said.

Land O'Lakes is one of the largest farmer cooperatives in the U.S., with 2014 sales of $15 billion. It's known for dairy and other consumer foods, Purina animal nutrition and a broad array of farmer production services. Villa Crop Protection will become part of the cooperative's WinField Solutions division, which reported annual sales of $4.9 billion in 2014.