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Saint Louis food company Bunge Ltd. announced it has entered into a definitive agreement with Netherlands-based Viterra Ltd., in an effort to create an agribusiness powerhouse.
The mega deal will create a global agribusiness company to compete in complex markets and better serve farmers and end-customers.
In a unanimous approval by the two companies’ Boards of Directors, Viterra shareholders would receive approximately 65.6 million shares of Bunge stock, with an aggregate value of approximately $6.2 billion and approximately $2.0 billion in cash, representing a consideration mix of approximately 75 percent Bunge stock and 25 percent cash. As part of the transaction.
Bunge will assume $9.8 billion of Viterra debt, which is associated with approximately $9.0 billion of highly liquid Readily Marketable Inventories. Viterra shareholders would own 30 percent of the combined company on a fully diluted basis upon the close of the transaction, and approximately 33 percent after completion of the Repurchase Plan.
Bunge plans to repurchase $2.0 billion of Bunge’s stock to enhance accretion to adjusted EPS. Bunge intends to commence repurchases no later than 18 months post-transaction close.
“Our highly complementary asset footprints will create a network that connects the world’s largest production regions to areas of fastest growing consumption, enhancing the geographical balance and adaptability of our global value chains and benefitting farmers and end-customers,” Bunge’s Chief Executive Officer Greg Heckman said in a press release. “With a diversified global mix of earnings across processing, handling and merchandising, and value-added products, we will increase the resiliency of our cash flow generation. We have great respect for the team at Viterra, which shares our commitment to excellence, and believe this combination will offer great opportunities for employees of both companies. Together, we will be positioned to increase our operational efficiency while innovating to address the pressing needs of food security, efficiency for end-customers, market access for farmers, and sustainable food, feed and renewable fuel production.”
Read the full press release, here.
Posted June 27, 2023.
