Bunge and Glencore’s Viterra merge to create agricultural trading giant

the american Bunge and Dutch company Viterra – owned in part by Swiss miner Glencore – announced Tuesday that they will merge to create a new international agricultural trade giant.

Under the agreement, Viterra shareholders will receive about 65.6 million Bunge shares, valued at about $6.2 billion (5.7 billion euros), and about $2 billion in cash.

Bungewhich will also assume US$ 9.8 billion of debt from Viterra and repurchase $2 billion of its own shares, it will retain control of the newly merged company, which will be led by its current CEO, Greg Heckman.

When the transaction is completed, the shareholders of Viterra They will own 30% of the combined company, a percentage that will increase to 33% when the share buyback plan is complete, the two parties explained in a statement.

“The combination of Bunge and Viterra significantly accelerates Bunge’s strategy, building on our fundamental purpose of connecting farmers and consumers to supply the world with essential food, feed and fuels.Heckman noted in the note.

The executive highlighted the complementary nature of the two businesses and how the merger will create a “network connecting the world’s largest production regions with areas with the fastest growing consumption”.

According to the companies, the merger will generate savings of about US$250 million per year in operations within three years of completion.

Bungeheadquartered in Saint Louis (Missouri, United States), is the world’s largest processor of vegetable oil and has some 23,000 employees spread over more than 40 countries, including Brazil and Argentina.

The American company is one of the largest agricultural trading companies worldwide along with ADM, Cargill and Louis Dreyfus.

Viterrawhich is controlled by Glencore along with two Canadian pension funds, is another large agricultural trading company with more than 17,500 workers and a presence in 37 countries.

Source: EFE