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WSJ: ADM’s takeover talks with Bunge break down

12 April 20182 min reading

Takeover talks between Bunge Ltd. and Archer Daniels Midland Co. have stalled, The Wall Street Journal reported, throwing into question a combination that could have formed one of the world’s largest agricultural conglomerates.

bunge

Talks surrounding Archer Daniels Midland’s takeover of Bunge Ltd. have halted, jeopardizing a merger that would have created one of the world’s largest agricultural companies. Prior to the breakdown, discussions were moving at a snail’s pace as the two companies considered how to avoid antitrust issues, according to The Wall Street Journal. It is unknown if the talks will resume. In early 2018, The Wall Street Journal reported that Chicago-based ADM, American global food processing and commodities trading Corporation, contacted Bunge regarding a takeover. The move would have pushed ADM further into South American grain markets and aided its soybean-processing business. The stalled talks may force leaders of the New York-based Bunge to search for a different buyer as the agricultural sector struggles with an excess of crops across the globe. Last month, Bunge reported that its net income had fallen in 2017 from $745 million to $160 million. ADM’s stumble could make way for Swiss-based rival commodity giant Glencore, which last year offered to buy Bunge. Bunge turned down Glencore’s offer and the two companies made an agreement that temporarily prevented Glencore from making a hostile bid for Bunge. That standstill agreement has since expired. Bunge had a market value of about $9.8 billion and ADM’s valuation was $22.6 billion. New York-based Bunge operates in more than 40 countries, while Chicago-based ADM is operating in 160 countries. ADM is the most U.S.-focused of the major grain companies and a takeover would help it grow in South America, where Bunge is a major agricultural force. ADM runs about 500 crop-buying facilities and 250 processing plants worldwide.

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