US: ADM confirms talks over cocoa unit sale
ADM in talks over cocoa sale
US agri-giant Archer Daniels Midland has confirmed it is in talks over a potential sale of its cocoa business.
A spokesperson for the group said the company is evaluating "strategic options" for the unit as part of its long-term commitment to "create shareholder value".
"We are currently engaged in discussions about the potential sale of our cocoa business. These discussions are ongoing, and there can be no assurance that they will result in the signing of a transaction or definitive agreement," the spokesperson said.
The company is one of the world's largest processors and suppliers of cocoa, with operations across six continents. ADM's cocoa unit supplies a range of cocoa products - including liquor, butter, powder, compound coatings and speciality products - to industrial customers. Estimates have placed the value of the business at around US$2bn.
ADM did not reveal who it is in talks with, but did suggest that it maintains an "ongoing dialogue with other agribusiness companies".
If the deal progresses, it will be the second major acquisition in the cocoa supply arena in the past year. Last December, Barry Callebaut entered into an agreement to acquire the cocoa business of Petra Foods in a bid to expand its presence in emerging Asian markets.
Attention is increasingly focusing on the growing Asian appetite for cocoa products. Cargill has also stepped up its investment in cocoa in the region, unveiling plans to build a new cocoa processing facility in Indonesia last month.
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