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Jan. 16, 2025 By Ismail Shakil, Reuters OTTAWA - Canada on Tuesday approved with conditions U.S. grains merchant Bunge's (BG.N), opens new tab $34 billion merger with Glencore-backed Viterra, clearing one of the final remaining obstacles for a global agriculture tie-up that is unprecedented in dollar value. The conditions for the approval include Bunge's divestiture of six grain elevators in Western Canada and a binding commitment from Bunge to invest at least C$520 million ($362 million) in Canada within the next five years, according to a statement from the transport ministry. The approval also requires strict and legally binding controls on Bunge's minority stake in Saudi-owned grain company G3 to ensure Bunge cannot influence G3's pricing or investment decisions, the ministry said. Bunge, Viterra and G3 account for a combined one-third of Western Canada's elevator capacity. The merger, announced in 2023, would create a global crops trading and processing giant worth $34 billion including debt, closer in scale with chief rivals Archer-Daniels-Midland Co (ADM.N), opens new tab and Cargill Inc (CARG.UL). "With the Canadian approval, we are nearing completion of the regulatory process and expect to close in early 2025," Bunge said in a statement to Reuters. The deal, approved by shareholders, would make the combined company better able to capitalize on an anticipated surge in demand for soybean and canola oil to produce biofuels in coming years than its rivals, but more consolidation in the industry leaves farmers with fewer buyers for their crops. Canada's antitrust watchdog flagged concerns around the deal in April, saying in a non-binding report that the transaction was likely to harm competition for grain purchasing in Western Canada, as well as for selling canola oil in Eastern Canada. To read the entire report click here. Tweet |
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