Bunge Limited announced its merger with Viterra Limited, creating an agribusiness company with a global network. Together, the companies 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 terms of the agreement, Viterra shareholders would receive approximately 65.6 million shares of Bunge stock, with an aggregate value of approximately USD 6.2 billion, and approximately USD 2.0 billion in cash. As part of the transaction, Bunge will assume USD 9.8 billion of Viterra debt, which is associated with approximately UAS 9.0 billion of highly liquid Readily Marketable Inventories, according to the joint press statement.
In addition, Bunge plans to repurchase USD 2.0 billion of Bunge’s stock as soon as possible, subject to market conditions and SEC rules on trading restrictions and expects to complete the repurchase plan within 18 months.
The merger strengthens the companies in their competition with Archer Daniels Midland and Cargill. Bunge shareholders will own about 70% of the combined company, because Bunge will pay for a significant chunk of the deal with cash, Reuters reports.
Once the transaction becomes final, the combined company will be led by Greg Heckman, Bunge’s Chief Executive Officer, and John Neppl, Bunge’s Chief Financial Officer. Viterra Chief Executive Officer David Mattiske will join the Bunge Executive Leadership Team in the role of Co-Chief Operating Officer. The combined company will operate as Bunge, NYSE: BG with operational headquarters in St. Louis, Missouri. Viterra’s current headquarters in Rotterdam will be an important commercial location in the future of the combined company.
Greg Heckman, Bunge’s Chief Executive Officer said, “The combination of Bunge and Viterra significantly accelerates Bunge’s strategy, building on our fundamental purpose to connect farmers to consumers to deliver essential food, feed and fuel to the world. Our highly complementary asset footprints will create a network that connects the world’s largest production regions to areas of fastest-growing consumption, enhancing the geographical balance and adaptability of our global value chains and benefitting farmers and end customers. With a diversified global mix of earnings across processing, handling and merchandising, and value-added products, we will increase the resiliency of our cash flow generation. 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.”
David Mattiske, Viterra’s Chief Executive Officer said, “Viterra and Bunge are two leading agriculture businesses. In combining our highly complementary origination, processing and distribution networks, we are better positioned to meet the increasing demand for the food, feed and fuel products we offer. Together, we will play a leading role in the future of the agriculture industry, developing fully traceable, sustainable supply chains and moving towards carbon-neutral operations, while creating a strong growth platform for our combined business. This further enables us to offer innovative solutions and open additional pathways for our customers. We will create value for stakeholders across our network, as we build on our shared purpose to connect producers and consumers around the world. We look forward to joining the Bunge team as we enter this next chapter, creating new opportunities for our people. The combined talent and experience of our workforce will allow us to offer a truly world-leading service across everything we do.”
The merger is expected to close in mid-2024, following regulatory approvals.
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