Louis Dreyfus to buy Chinese oilseed firm from Golden Agri

Golden Agri-Resources

27/11/2017 18:42

PARIS, Nov 27 (Reuters) - Global trading house Louis Dreyfus 
Company is to buy an oilseed crushing and vegetable oil refining 
business in China from Singapore-based Golden Agri-Resources 
 GAGR.SI , extending its presence in the world's biggest oilseed 
importing country. 
    A Louis Dreyfus subsidiary is to buy Sinarmas Natural 
Resources Foodstuff Technology (Tianjin) Co. from a subsidiary 
of Golden Agri-Resources on the basis of an enterprise value of 
$111 million, Golden Agri-Resources said in a filing on Monday. 
 urn:newsml:reuters.com:*:nFWN1NV063 The final price is subject to adjustment, the 
filing said. 
    The business being acquired by Louis Dreyfus owns and 
operates oilseed crushing and refining facilities in the 
northeastern Chinese port city of Tianjin. 
    Dreyfus  AKIRAU.UL  is one of the so-called ABCD group of 
merchants alongside Archer Daniels Midland  ADM.N , Bunge 
 BG.N , Cargill  CARG.UL  that have long dominated global trade 
in agricultural commodities. 
    Like its rivals, Dreyfus has been grappling with declining 
margins linked to high levels of supply and reduced price 
volatility, leading it to spin off some businesses and focus on 
core activities including grains and oilseeds.  urn:newsml:reuters.com:*:nL8N1M93LH 
    A Louis Dreyfus spokeswoman said the deal reflected the 
group's confidence in the Chinese agricultural processing 
sector, without giving further financial details. 
    The ABCD merchants are facing competition from China's 
state-owned COFCO Corp, whose international trading arm is 
looking to expand direct sourcing from farmers worldwide and 
reduce its reliance on foreign trading houses.  urn:newsml:reuters.com:*:nL8N1NX1JX 
    Golden Agri-Resources, which is one of the world's largest 
palm-oil plantation owners, said the sale was a strategic 
decision to sell a non-core oilseed asset. 
    The agreement is subject to regulatory approval. 
     
 
 (Reporting by Gus Trompiz. Editing by Jane Merriman) 
 ((gus.trompiz@thomsonreuters.com; +33 1 49 49 52 18; Reuters 
Messaging: gus.trompiz.thomsonreuters.com@reuters.net)) 
 
Keywords: LOUISDREYFUS GOLDEN AGRI/CHINA