Through the US firm's European operating arm Bunge Europe the company will acquire the Polish edible oil and margarine producer Kama Foods from bankruptcy receivership. A move designed to build on existing business in Poland.
"This strategic acquisition is part of Bunge's continued expansion in Eastern Europe," said Jean-Louis Gourbin, CEO of Bunge Europe. "It will allow Bunge to build closer relationships with farmers and to better serve customers and consumers in Poland," he added.
Under the terms of the agreement, EWICO - in which Bunge has a 50 per cent stake - will purchase the assets of Kama Foods 'free and clear of all debts and liabilities' for approximately PLN81 million (€17.4 million), with PLN20 million payable 'on execution of the preliminary agreement'.
The deal is expected to close by the end of June 2004, at which time EWICO will pay the outstanding balance, Bunge said in a statement yesterday.
Citing risk management and 'locked in prices' as supporting the rise, last month Bunge reported a 3 per cent increase on net income for the fourth quarter 2003 ended 31 December, coming in at $100 million, from $97 million posted for the same period a year before.
While the company's edible oils business benefited from the recently acquired French oil company Cereol - profit rolling in at $13 million for the quarter, up from $3 million for the year before - a harder time was felt in the agribusiness sector where droughts cropped the soybean harvests, sending prices to seven year highs. Even improvements in edible oils for the company were partially offset by increases in the raw materials, primarily soybean oil.
In addition to acquiring the privately-owned French oil processor Cereol, in 2003 Bunge headed deeper into soy ingredients announcing the launch of Solae, a new plant-based ingredients company established in alliance with DuPont Protein Technologies.