Bunge and Viterra merger
The merger of two global agri-food companies will create a company worth nearly $35 billion. The newly formed company will be able to compete more effectively with two other global grain giants, Archer-Daniels-Midland and Cargill.
Approval by the European Commission
Due to its scale, the merger had to be accepted European Commission. It did so on Friday on a conditional basis – both companies must fulfill their commitments in order to avoid excessive concentration in the oilseed market: rapeseed and sunflower. At the beginning of July American Bunge and Canadian Vittera proposed to the EC that they sell Viterra’s plants dealing with crushing and refining oilseeds in Hungary and Poland.
Margrethe Vestager, Vice-President of the European Commission responsible for competition, said in the press release that preventing concentration in agricultural supply chains is crucial for both farmers and consumers.We had concerns that the transaction could impact the rapeseed and sunflower seed supply chains in Central Europe, with potential consequences for the food, feed and biofuel industries“The divestment of Viterra’s entire oilseeds business in Hungary and Poland will preserve competition in these markets,” the commissioner said.
A merger without precedent
Viterra, which has been operating in Poland since 1997, is engaged in trade, storage, transhipment and transport of grain, oil plants, edible oils and meal.
The deal is an unprecedented size in the global agriculture sector, Reuters noted, and comes as Bunge reports record profits in 2022, benefiting from tight global grain supplies amid the war with Ukraine.
From Brussels Magdalena Cedro (PAP)
