Louis Dreyfus Commodities is to issue bonds for the first time in its history as it prepares to step up acquisitions.
A spokesperson for the commodities trader confirmed comments Louis Dreyfus chief executive Serge Schoen made to The Financial Times in which he said the company aims to raise the cash to fund acquisitions.
Louis Dreyfus plans to spend an estimated US$7bn, increasing its investment by 40% over the next five years.
Schoen told the FT the company has a “strong balance sheet” but explained it wants to “diversify” its sources of capital, including raising public debt through bonds”.
A spokesperson for Louis Dreyfus told just-food the bond offering is likely to be for around $500m and will take place at some point this year.
Asked what type of acquisitions the company will make, the spokesperson said: “We did a deal with Felda yesterday, those are the kind of acquisitions we will be looking at.”
The company yesterday announced it has agreed to pay around $150m for a stake in Malaysian palm oil group Felda Global Ventures Holdings.
In addition to the bond issue, Schoen told the FT that it will consider an initial public offering for its LDC-SEV sugarcane subsidiary in which it owns a 65% stake.
The spokesperson said the company had “filled in the form” for the IPO but added a listing was not yet certain.
Earlier this month, Louis Dreyfus made a recommended offer to acquire US sugar refiner Imperial Sugar in a deal valued at $203m, including the assumption of debt.