Global agribusiness and food giant Bunge Limited yesterday [Monday] announced that it has closed its acquisition of La Plata Cereal SA, a leading Argentine agribusiness company, for a maximum enterprise value of US$50m in cash and assumed debt.
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The acquisition is in line with Bunge’s stated strategy of pursuing selective acquisitions to expand its core businesses in key growth markets. Bunge expects the acquisition to be accretive to earnings in the second quarter of 2002.
Bunge acquired La Plata from Andre & Cie SA, the Swiss agribusiness company. Bunge believes that this acquisition makes it the largest soybean processor and the second largest exporter of agricultural products from Argentina, both based on volumes. The acquisition also expands Bunge’s fertiliser business, which is already the largest producer and supplier of fertiliser in South America based on volumes, into Argentina.
As a result of the acquisition, Bunge Argentina’s soybean crushing capacity will increase 83% to 4.4 million metric tons per annum. Bunge believes that its grain and soybean export volume will increase 81% to 2.9 million metric tons per annum.
“Despite the recent financial difficulties faced by Argentina, the country is still the world’s low-cost producer of grains and oilseeds,” stated Alberto Weisser, chairman and CEO of Bunge Ltd. “The acquisition enhances our already strong position in this critical export origin.”
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By GlobalDataRaul Padilla, president and CEO of Bunge Argentina added: “La Plata’s businesses and asset mix are highly complementary to our existing infrastructure. The integration of La Plata with Bunge Argentina will produce a powerful grain origination, soy processing and export platform and will establish a solid foothold for Bunge in the Argentine fertiliser market.”
Similar to Bunge’s existing business in Argentina, La Plata has been primarily an export company, shipping grains and oilseed products to Europe and Asia.
Bunge has operated in Argentina since 1884.
