Legend Holdings, which owns Lenovo Group, the world’s second-largest PC maker, is planting itself deeper into the agricultural sector with Joyvio Group

Legend puts down deeper roots in agribusiness

Staff Reporter

2013-05-15

Legend Holdings, which owns Lenovo Group, the world’s second-largest PC maker, is planting itself deeper into the agricultural sector with Joyvio Group, which specializes in investment in and operation of related businesses in the area of modern agribusiness, the Beijing-based The Economic Observer reports. By using satellite technology to manage its farms, Joyvio can immediately see the condition of its crops. It has installed GPS on its drug-injecting carts to monitor pesticide sprays.On May 8, Legend chairman Liu Chuanzhi turned down the invitation of his good friend Alibaba CEO Jack Ma to attend Ma’s resignation ceremony, because Liu has an even more important mission — to introduce the Joyvio brand in its first exposure. Liu has commissioned Chen Shaopeng, Legend’s senior vice president, to head Joyvio, in a bid to use Legend’s information technology power to complement agribusiness, a field which traditionally relies on the fickle weather. After investing more than 1 billion yuan (US$160 million) in the venture, Legend has become China’s biggest blueberry supplier, owning 20% of the nation’s blueberry market, andhas similar plans to be a significant player in the market for other fruits.

Legend Holdings plans to list sometime in the next three years, and Joyvio is an important part of helping to achieve that goal. Stable income from Joyvio is contributing more to the listing plan than quick profits from other businesses on Liu’s mind, the report said.

Consumer demand for safe, high-quality agricultural produce continues to grow in China, but supply falls far short of demand. Legend founded its Modern Agribusiness Unit in July 2010 and Joyvio in August 2012, which grew from the agribusiness unit and is independently operated.

Chen Shaopeng first acquired blueberry farms, then bought a Sichuan firm which owned thousands of acres of kiwi fruit farms.

To meet Legend’s mid- to long-term plan to be a world-class fruit supplier, Chen then went on to buy five fruit-producing businesses in Chile. Chen said Joyvio acquired these five Chile businesses at “very reasonable prices” at a time when demand in the international markets declined but China’s demand continued to grow.

Chen said Legend’s ideal agribusiness model is as a “sunrise industry.” In other words, the agribusiness needs at least five to seven years to reach production targets. Legend will continue to invest in Joyvio, without setting up a ceiling, Chen said.

Joyvio is planning to enter the food processing industry — an important asset for the company to absorb risks that most agribusinesses are facing. Integrating the agribusiness’ upstream to downstream sectors will help inaulate Joyvio against potential risks.