The European Commission has cleared the proposed acquisition of French-based food company Cereol by Bunge of the United States.


The Commission’s investigation showed that the two companies’ activities were largely complementary and that Bunge would face sufficient competition despite becoming the world’s leading oilseed-processing company.


Bunge is an US-based agribusiness and food company whose activities include grain and oilseeds trading, oilseeds processing, edible oils and specialty food products. Cereol is a French-based food company also active in oilseeds processing, specialty food ingredients and edible oils. It was formerly part of the Eridania Beghin-Say group of companies, controlled by Italy’s Edison. In July 2001, EBS was demerged into four separate companies.


Under the terms of an agreement notified to the European Commission on August 19, Bunge will acquire sole control of Cereol from Edison by way of purchase of shares. After the closing of the purchase of the 55% stake held by Edison Bunge will purchase the remaining 45% of Cereol shares that are publicly held.


The Commission’s investigation showed that the activities of Bunge and Cereol are largely complementary, with only limited overlaps. Bunge unlike Cereol has no production facilities in the EEA. The market is characterised by the existence of alternative current or potential suppliers and a considerable degree of demand substitutability between various types of oilseeds which will effectively counter any anti-competitive behaviour by Bunge. The Commission concluded that the acquisition would not lead to the creation or strengthening of a dominant position under all alternative market definitions.