Glencore to acquire Canadian grain handler Viterra for $6.2 bn
22 Mar 2012
Commodities giant Glencore International Plc yesterday struck a C$6.1-billion ($6.2 billion) cash deal to acquire Canada's largest grain handling company Viterra Inc.
Glencore, which is in the midst of merging with mining group Xstrata, has roped in two Canadian partners for he deal - fertiliser company Agrium and grain handling firm Richardson International, both of whom will buy most of Viterra's Canadian business for $2.6 billion.
Glencore will sell the majority of Viterra's retail agri-products business, including a 34 per cent interest in Canadian Fertilizer Limited to Calgary and Regina-based Agrium, for $1.8 billion, while Viterra's Canadian grain-handling assets, some agri-centres and processing assets in North America will be sold to privately-owned Winnipeg-based Richardson, for $800 million in cash.
Baar, Switzerland-based Glencore will acquire the bulk grain handling assets of Viterra, including storage and port facilities in both Canada and Australia.
Glencore is paying $16.25 per share, representing a premium of 48 per cent over Viterra's closing price on the Toronto Stock Exchange of $10.98 on 8 March, the day before Viterra announced it had received expressions of interest.
Not making the mistake that mining giant BHP Billiton did in trying to takeover Canada's Potash Corp of Saskatchewan last year, Glencore smartly roped in two Canadian companies in to the deal in order to avoid concerns over foreign ownership of Canadian resource companies.
