Glencore Said to Express Interest in Buying Canadian Grain-Handler Viterra

notafarmer

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Glencore Said to Express Interest in Buying Canadian Grain-Handler Viterra
By Jesse Riseborough and Matthew Campbell - Mar 12, 2012 4:22 AM CT .LinkedIn Google +1 Print QUEUEQ..Glencore International Plc (GLEN),the world?s largest publicly traded commodities supplier, has expressed an interest in Canada?s biggest grain handler Viterra Inc. (VT),according to a person familiar with the situation.

Other companies may also be studying Viterra, said the person, who declined to be identified because the details haven?t been made public. Closely held grain distributor Cargill Inc. has expressed an interest, the Wall Street Journal reported, citing people it didn?t identify. Viterra has gained 24 percent since saying last week it had received approaches, giving it a market value of C$5 billion ($5 billion).

Glencore International Plc CEO Glasenberg Jerome Favre/Bloomberg
Ivan Glasenberg, chief executive officer of Glencore International Plc, is looking to expand his North American grain business.

?A bidding war for Viterra could emerge and a large price will need to be paid,? Belinda Moore, a Brisbane-based analyst with RBS Morgans Ltd., said today in a report.

Holly Gibney, a spokeswoman for Regina, Saskatchewan-based Viterra, declined to comment and referred back to the company?s March 9 statement in which it said it had received expressions of interest.

Largest Share
A spokesman for Baar, Switzerland-based Glencore declined to comment. Lisa Clemens, a spokeswoman for Cargill, declined to comment. Glencore?s interest in Viterra was reported earlier by the Sunday Telegraph.

Buying Viterra would give Glencore the largest share of the Canadian grain-handling market just as the Canadian Wheat Board?s monopoly over wheat and barley grown in the west of the country comes to an end.

Viterra?s share of Canadian grain-handling may rise to almost 50 percent in the next few years from 45 percent, its Chief Executive Officer Mayo Schmidt said in an interview on March 8.

?We believe this mooted acquisition has credibility,? Liberum Capital Ltd. analysts Dominic O?Kane and Ash Lazenby wrote in a note to clients today. ?The timing looks attractive given that the Canadian Wheat Board?s monopoly over wheat and barley is about to terminate, meaning Viterra?s market share would increase to circa 50 percent.?

Read more at http://www.bloomberg.com/news/2012-...in-buying-canadian-grain-handler-viterra.html
 

aginfo

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Cargill interested in buying Viterra: WSJ

U.S. agribusiness giant Cargill Inc. is one of the parties interested in acquiring Viterra Inc., Canada?s biggest grain handler, the Wall Street Journal reported on its website on Sunday citing people familiar with the matter.

Viterra shares surged more than 20 per cent on Friday after the company said it had received expressions of interest from unnamed third parties on a possible takeover.

Commodities and mining giant Glencore International Plc. is also interested in Viterra and has made a £3.5-billion pound ($5.5-billion U.S.) approach, Britain?s Sunday Telegraph newspaper earlier reported.

The Journal reported that Viterra was expected to run a sale process, exploring the interest of a handful of possible buyers. A Viterra spokeswoman declined to comment. A Cargill spokeswoman could not immediately be reached for comment.

More at http://www.theglobeandmail.com/glob... RSS/Atom&utm_source=Home&utm_content=2366317
 

notafarmer

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John DePape: The Possible Sale of Viterra

John Depape, The CWB Monitor, talks to RealAgriculture.com about the potential sale of Viterra to a foreign company like Glencore. John gives his feelings on whether Viterra is a national strategic asset, whether the competition bureau has anything to say about this size of deal, and if this potential deal with Glencore makes any sense to him.

More at http://www.realagriculture.com/2012/03/john-depape-the-possible-sale-of-viterra/
 

aginfo

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Viterra establishes takeover process

Viterra Inc., the Canadian grain handler that attracted Glencore International Plc as a potential suitor, said a process has been established after the company received expressions of interest.

The process includes confidentiality agreements being entered into and the provision of due diligence, Regina, Saskatchewan-based Viterra said today in a statement.

Viterra was halted earlier in Toronto trading after dealReporter said bidders were told they must offer at least C$16 ($16.09) a share to be allowed to assess the company?s internal data. U.S. companies Archer Daniels Midland Co. and Bunge Ltd. and Hong Kong-based Noble Group Ltd. are in the company?s so-called data room, dealReporter said today, citing a person familiar with the situation whom it didn?t identify.

Switzerland?s Glencore, the world?s largest publicly traded commodities trader, expressed an interest in Viterra, a person familiar with the situation said March 11. Viterra, Canada?s largest grain handler, reiterated last week that it stands to profit as the Canadian Wheat Board?s monopoly on purchasing wheat and barley in the country?s western provinces ends Aug. 1.

Viterra said today it?s aware of reports about the parties involved in the process and the minimum price. There?s no assurance of a deal or, if there is one, at what price it will be concluded, the company said.

David Weintraub, an ADM spokesman, said by phone the company doesn?t comment on rumors or speculation. Susan Burns, a Bunge spokeswoman, declined to comment in an e-mail. No one was immediately available to comment at Noble?s London office.

Read more at http://www.thestar.com/business/article/1146702--viterra-establishes-takeover-process
 

james

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Viterra suitors could carve up grain giant after take over

Canadian agribusiness heavyweights Agrium Inc. and Richardson International are teaming up with global commodities giant Glencore International Inc. to bid for Canada's largest grain-handler, Viterra Inc., in a possible deal that could see the company split up between the three.

The trio are preparing a bid that under the current framework would leave a large chunk of Viterra's Canadian assets in Canadian hands, a source confirmed to the Financial Post.

The source said Glencore is specifically seeking the company's grain business, while Calgary-based Agrium is looking to get its hands on the retail fertilizer supply stores Viterra runs. Richardson would be interested in Viterra's food-processing business.

According to Viterra's most recent presentation to investors, made in December, the grain business, which includes grain handling and marketing, accounts for $526 million of Viterra's earnings in the past 12 months (based on earnings before interest, taxes, depreciation and amortization).

The agri-products segment that Agrium is seeking to buy, meanwhile, accounts for $222 million, while the food processing business Richardson is after accounts for $129 mil-lion of earnings.

Viterra has not publicly commented on the potential bid, but the company did announce Thursday that it has signed confidentiality agreements with possible buyers and has hired financial and legal advisers as it begins a sale process.

The company's stock surged on the news, closing at a re-cord high of $16.09, a gain of 10 per cent.



Read more: http://www.calgaryherald.com/busine...ter+takeover/6311445/story.html#ixzz1pI49RAMW
 

notafarmer

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UPDATE 2-Glencore would divide Viterra in 3 parts -source

* Bids crafted to avoid regulator concerns

* Glencore would buy Viterra, split it up

* Agrium, Richardson would take parts of grain trader

By Victoria Howley and Rod Nickel

LONDON/WINNIPEG, Manitoba, March 16 (Reuters) - Glencore would carve up Viterra into three pieces if it wins a bidding war for Canada's largest grain handler, an industry source said on Friday, describing the Swiss trader's plan for navigating the government scrutiny that a foreign takeover would face.

The source told Reuters the commodity trading giant wanted to buy all of Viterra and then sell its retail business to Agrium, a Canadian fertilizer producer.

Richardson International, a closely held Canadian grain trader, would take Viterra's food processing unit in a rare and complex deal known as "back-to-back" transaction.

Earlier reports said Glencore, also bidding for mining group Xstrata, was planning a joint offer with Agrium and Richardson, something that might help the Swiss-based trader get round Canadian concerns about a sale to a foreign entity.

As the second-largest Canadian grain handler, Richardson would likely also be interested in some grain elevator and port assets.

Viterra, based in Regina, Saskatchewan, said Thursday it had established a process for potential buyers, and its stock rose 10 percent.

MONOPOLY ENDING

Viterra stands to profit from a government decision to end the Canadian Wheat Board's monopoly on Western Canadian wheat and barley sale. A successful bidder would win access to Canada's high-quality canola, spring wheat, oats and durum wheat supplies. Canada, the world's No. 8 grains producer, is the leading exporter of each crop.

The company's shares ticked up 0.6 percent on Friday to C$16.18, while Glencore stock gained 1.5 percent to 420.36 pence.

Shares have hovered around $16 since Thursday, when Viterra said it was aware of media reports of interest at that price. That would value it at some C$5.9 billion ($5.95 billion).

U.S.-based Bunge and Archer Daniels Midland have also made approaches to Viterra.

Read more at http://www.reuters.com/article/2012/03/16/glencore-viterra-idUSL5E8EG2CQ20120316
 

notafarmer

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Glencore to Buy Viterra for $6.18 Billion

TORONTO?Viterra Inc. said Tuesday it agreed to be acquired by Glencore International PLC for $6.1 billion Canadian dollars ($6.18 billion),ending a sale process that started two weeks ago and triggered a surge in the Canadian grain-handler's stock.

Viterra operates grain-marketing and distribution businesses across Canada, the U.S., Australia, New Zealand and China. It controls 45% of the grain trade in Canada, the world's sixth largest exporter, and has a large operation in Australia, the third-largest grain-exporting country.

Switzerland-based Glencore, the world's largest commodity trader, has agreed to pay 16.25 Canadian dollars a share. Viterra's stock was trading at 10.98 Canadian dollars on March 8, the day before it first disclosed it had been approached by potential buyers. Some shareholders have suggested the stock is worth around 19 Canadian dollars because of the scarcity value of its grain-handling network. In Toronto, Viterra was recently trading at 15.92 Canadian dollars, down 0.3% since the start of the day.

The deal will help Glencore, already a big trader of oil, sugar, coal and other commodities, achieve its stated goal of increasing its exposure to grain, as economic growth in China and other emerging economies fuels food demand.

"The acquisition of Viterra is consistent with Glencore's strategy of strengthening its position as one of the global leaders in grain and oilseeds markets," Glencore said in a statement. Glencore's deal for Viterra comes at the same time it is trying to complete a much-larger $90 billion merger with Anglo-Swiss miner Xstrata PLC.
Viterra also operates a string of retail farm-supply stores. Glencore said it has agreed to sell a majority of Viterra's agriproducts business in Canada and Australia to Calgary-based Agrium Inc. for 1.8 billion Canadian dollars. The deal complements Agrium's existing network of 1,200 farm-supply retail facilities in the U.S., Canada, Australia, and South America.

More at http://online.wsj.com/article/SB10001424052702304636404577293350190169954.html
 

aginfo

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Glencore International will acquire Viterra Inc., Canada's largest grainhandler, for $6.1-billion, and promised to establish its North American head office in Regina, the company announced Tuesday, ending weeks of speculation and months of negotiations, The Swiss commodities conglomerate intends to sell the majority of its Canadian assets to James Richard-son & Sons of Winnipeg and Calgary-based fertilizer giant Agrium, while expanding its operations in North America.

"Regina will be our headquarters," said Chris Mahoney, director of agricultural products for Glencore. Viterra's Regina head office employs about 400, including 200 unionized employees.

"We are looking to expand also in the U.S. Because of the undoubted need for Canadian production to grow and Canadian exports to grow, we expect to invest further in [grain] handling infrastructure."

The transaction price of $16.25 per share represents a premium of 48 per cent over Viterra's closing price on the Toronto Stock Exchange of $10.98 on March 8, the day before Viterra announced it had received expressions of interest.

"The acquisition reflects our strong belief in the importance and future potential of the Canadian and Australian grain markets," Mahoney said.

Mahoney was confident Investment Canada and the Competition Bureau would approve the deal because most of Viterra's Canadian assets are to be sold to Canadian companies.

Read more: http://www.vancouversun.com/business/Glencore+Viterra+billion/6335189/story.html#ixzz1plZYVPZn
 

aginfo

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Viterra Sale May Raise Competition Concerns, Premier Wall Says

Saskatchewan Premier Brad Wall said Glencore International Plc?s proposed acquisition of Viterra Inc. (VT) raises concerns about reduced competition in the market for crop inputs such as fertilizer.

While the transaction addresses competition issues in grain sales and handling, the province needs to study whether there will be less competition for inputs, Wall said yesterday. He has set up a working committee to study the deal and make recommendations to the federal government.

?There are real questions that we need to find out about the inputs in the fertilizer side because I think there?s concentration issues there possibly,? Wall said in a telephone interview from Regina, the provincial capital. ?We?ll do our homework though and come to a decision and make a recommendation.?

Glencore, the largest publicly traded commodity supplier, offered C$6.1 billion ($6.1 billion) to buy Viterra, Canada?s biggest grain handler. As part of the transaction, Calgary-based Agrium Inc. (AGU) will acquire about 90 percent of Viterra?s Canadian retail facilities.

Agrium?s ?retail presence? in Western Canada may increase by 3 to 4 percentage points after the Viterra deal, Richard Downey, an Agrium spokesman, said yesterday in a telephone interview.

Under the Investment Canada Act, the federal government reviews foreign acquisitions of companies with assets valued at more than C$330 million. The C$16.25-a-share offer announced by Baar, Switzerland-based Glencore will also require approval from Canada?s competition bureau, which said it would be reviewing the proposed transaction.

Read more at http://www.bloomberg.com/news/2012-...e-competition-concerns-premier-wall-says.html
 
 
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