Bunge Limited has announced that it has entered into an agreement with Viterra Limited to merge the two grain companies, a June 13 news release said. Viterra is a privately owned company by Glencore PLC, Canada Pension Plan Investment Board and British Columbia Investment Management Corporation. The merger will happen via a stock and cash transition.
“The merger of Bunge and Viterra will create an innovative global agribusiness company well positioned to meet the demands of increasingly complex markets and better serve farmers and end-customers,” the release said. “Together, the highly complementary organizations will benefit from more diversified capabilities, greater operational flexibility across oilseed and grain supply chains and processing, greater resources and combined employee talent to innovate and deliver for customers in every environment, creating value for all stakeholders.”
Under the agreement, which was unanimously approved by the board of directors of Bunge and Viterra, Viterra shareholders would receive approximately 65.6 million shares of Bunge stock, a value of approximately US$6.2 billion, and approximately US$2 billion in cash, representing approximately 75 per cent Bunge stock and 25 per cent cash, the release said. As part of the transaction, Bunge will take over US$9.8 billion of Viterra debt. Bunge also plans to repurchase US$2 billion of their stock.
“We have great respect for the team at Viterra, which shares our commitment to excellence, and believe this combination will offer great opportunities for employees of both companies. Together, we will be positioned to increase our operational efficiency while innovating to address the pressing needs of food security, efficiency for end-customers, market access for farmers, and sustainable food, feed and renewable fuel production,” Greg Heckman, Bunge CEO, said in the release.
The combined company will be led by Heckman as CEO, and John Neppl, who is Bunge’s current chief financial officer. The company’s headquarters will be in St. Louis, Miss. The release noted Viterra’s current headquarters in Rotterdam will be an important commercial location in the future of the combined company.
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