SWITZ: Glencore International completes Viterra buy

By Chris Mercer | 19 December 2012

Commodity trader Glencore has said it wants to be a "true leader" in global grain trading after completing its acquisition of Viterra in a deal worth US$6bn.

Glencore said this week its completion of the deal hands it "immediate critical mass" in the key grain markets of North America and Canada, as well as Australia. It will pay Viterra shareholders C$16.25 (US$16.47) per share in cash.

The move by the Switzerland-based commodity trader will also create more competition for established agribusiness powerhouses such as Archer Daniels Midland, Bunge and Cargill.

Chris Mahoney, director of agricultural products at Glencore, said: "By combining Viterra's first class assets, grain logistics and processing insight with our global marketing capability, we have the opportunity to become a true leader across the sector."

Glencore originally announced a deal to buy Viterra in March but has been kept waiting by China's Ministry of Commerce. Regulatory clearance was needed in China due to a Viterra joint venture in the country.

In a tit-for-tat scenario, Reuters notes that there has been speculation that Chinese authorities were waiting to see if Canada's own competition body would approve China-based CNOOC's buyout of Canadian oil producer Nexen. Approval for that deal was announced earlier this month.

As part of Glencore's buyout of Viterra, it has committed to selling certain assets, including some grain handling operations and farm retail stores, to Richardson International and Agrium. These disposals will be completed by the end of 2013, Glencore said this week.

Show the press release

Glencore completes acquisition of Viterra and announces key management appointments

/NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION/

BAAR, Switzerland, Dec. 17, 2012 /CNW/ - Glencore International plc ("Glencore") and Viterra Inc. ("Viterra") announced today that Glencore has completed the acquisition of Viterra. The acquisition brings Glencore immediate critical mass in the key grain markets of North America through Viterra's substantial Canadian operations. Viterra also materially expands Glencore's existing operations in Australia. The acquisition reinforces Glencore's position as one of the world's leading commodity suppliers.

Fran Malecha, formerly Chief Operating Officer of Viterra, has been appointed Director, Agricultural Products, North America, with responsibility for all North American operations.  He will be based in Regina, Saskatchewan which becomes headquarters for Glencore's North American Agricultural Products business.  David Mattiske has been appointed Country Manager, Agricultural Products, Australia and New Zealand, with responsibility for all agricultural operations in Australia and New Zealand.

Chris Mahoney, Director of Agricultural Products of Glencore, said, "By combining Viterra's  first class assets, grain logistics and processing insight with our global marketing capability, we have the opportunity to become a true leader across the sector with even greater means to meet the needs of farmers and customers globally.

"Glencore has acquired more than physical assets; we have gained the world class skills and experience of Viterra employees and we are already working well together to implement a smooth integration. Furthermore, I am delighted to welcome Fran and David to their new positions and I have every confidence that the businesses in North America and Australia will thrive under their leadership."

Fran Malecha, said, "Today marks the beginning of an exciting new chapter for the company. I am excited to be staying on to lead Glencore's North American agricultural business, and look forward to strengthening our relationships with farmers and creating opportunities for all participants in the industry."

David Mattiske, said, "Glencore values Viterra's Australian and New Zealand people and assets as a critical part of its global portfolio. This transaction reflects Glencore's strong belief in the importance and potential of the Australian and New Zealand grain industries. The combined business will provide additional opportunities for growers and industry participants."

Glencore anticipates all integration projects, including the divestment of certain assets to Agrium Inc. and Richardson International Limited, will be completed by the end of 2013. Until the time of divestiture, Glencore will continue to support these assets.

Information for shareholders and CDI holders

Shareholders will be entitled to receive payment of C$16.25 per share in cash (the "Consideration") following the effective date of the Arrangement. Shareholders will receive Canadian dollars unless an election is made to receive payment in Australian dollars.

Registered shareholders are required to submit a Letter of Transmittal to Computershare Trust Company of Canada, together with the certificate(s) representing shares of Viterra and all other required documents.  For a replacement Letter of Transmittal, contact Computershare Trust Company of Canada toll free at 1-877-477-1538. Registered shareholders must make their currency elections in the Letter of Transmittal by no later than 5:00 p.m. (Toronto Time) December 18, 2012.  Non-registered shareholders should contact their broker, trustee, financial institution, custodian, nominee or other intermediary to confirm matters relating to payment of the Consideration, or if they wish to elect to receive Australian dollars.

Each CDI holder, as of 6:30 p.m. (Adelaide Time) on December 17, 2012 is entitled to receive payment of C$16.25 (or the Australian dollar equivalent) per CDI in cash.  CDI holders are not required to submit a Letter of Transmittal.

CDI holders were able to elect to receive payment in Canadian dollars. If no election was made prior to 5:00 p.m. (Australian Central Standard Time) today, holders of CDIs are deemed to have elected to receive payment in Australian dollars.

Further to the Glencore press release of December 7, 2012, amendments to Viterra's 5.950% Senior Notes due 2020 have been implemented and consent fee payments to consenting noteholders shall be made shortly.

About Glencore International plc
Glencore is one of the world's leading integrated producers and marketers of commodities, headquartered in Baar, Switzerland, and listed on the London and Hong Kong Stock Exchanges. Glencore has worldwide activities in the production, sourcing, processing, refining, transporting, storage, financing and supply of Metals and Minerals, Energy Products and Agricultural Products

SOURCE: Glencore International plc

Original source: http://www.newswire.ca/en/story/1090517/glencore-completes-acquisition-of-viterra-and-announces-key-management-appointments

Sectors: Cereal, Commodities & ingredients, Mergers & acquisitions

Companies: Archer Daniels Midland, Bunge, Cargill

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