Nutreco to acquire Cargill's animal nutrition operation in Spain and Portugal
29 July 2009
Cargill Inc, the Minnesota-based, privately held multinational company has agreed to sell its animal nutrition operations in Spain and Portugal to Nutreco. The sale, subject to the European Commmission competition authority will include the company's 12 animal nutrition production facilities and offices in the two countries. The transaction is expected to be concluded in the next few weeks.
The total consideration for the acquisition is around €40 million. This includes integration and transformation costs and investments in production locations in the next two years.
Under the agreement Nutreco will acquire the animal nutrition business of Cargill in Spain and Portugal. The 12 compound feed production facilities, have a production output of around 700,000 metric tonnes, annual sales of approximately € 240 million and 450 employees. The acquisition will contribute to strengthening Nutreco's leading market position in animal nutrition in the region.
The acquired business which offers animal nutrition solutions for all farmed animal species is expected in two years' time to contribute an operating margin as Nutreco's compound feed business in Iberia, according to the company's press release.
According to Francisco Irazusta, managing director of Nanta, Nutreco's animal nutrition business in Iberia, with the acquisition, Nutreco would gain significant know-how and expertise from Cargill's team of professionals. He added that the talent of the new team would generate synergies for setting higher standards across the industry in terms of food safety, quality and innovation for the benefit of existing and new customers.
According to Joe Stone, president of Cargill's animal nutrition business, Cargill has been a leading player in animal nutrition products in the region and the move comes as the company prepares to reassess its portfolio.