Green light for Cereol purchase
go ahead to continue with its proposed acquisition of a 55 per cent
controlling stake in French oil seed company Cereol. Ingredients
company Central Soya, a subsidiary of Cereol, could shortly have a
new owner.
Regulatory bodies in the US have given US oil processor Bunge the go ahead to continue with its proposed acquisition of a 55 per cent controlling stake in French oil seed company Cereol. Ingredients company Central Soya, a subsidiary of Cereol, could shortly have a new owner.
In July this year Bunge signed a definitive agreement to acquire an approximately 55 per cent controlling stake in Cereol from Italian energy company Edison for €32 per share, or approximately €449.2 million in cash. As required by French law, Bunge intends to make an offer to purchase, at the same price per share, the remaining 45 per cent of Cereol shares that are publicly held after the closing of the purchase of the Edison shares. The transaction, which is now expected to close in 2002, is still awaiting regulatory approval from antitrust authorities in the European Union.
If approved the sale could see Bunge pushing ahead of agribusiness giant Cargill and into the number one slot as the world's largest soybean processor.
When the acquisition was proposed earlier this year ingredients company Central Soya, a subsidiary of Cereol, welcomed the move.
"We at Central Soya are very excited about becoming part of Bunge, soon to be the leading oilseed processor in the world," said Carl Hausmann, president and CEO of Central Soya and chairman and CEO of Cereol. "The combined company will provide more opportunities for our employees, it will provide our customers access to a broader range of products and it will give producers access to more markets around the world."
Analysts maintain that although the US market is more mature, Bunge will be able to achieve more efficiencies and economies of scale out of the US operation because it will gain control of Central Soya, a soybean processor with plants in the eastern corn belt of the US that complement Bunge's own operations in the western corn belt and along the Mississippi.
With the acquisition of Cereol from Edison, formerly part of agro-industrial Italian conglomerate Montedison, Bunge is the second US grain giant to acquire a strong stake in the European ingredient market this year. Bunge's grain competitor Cargill completed the purchase of French starch producer Cerestar, also from Montedison, in April this year.
