Viterra has entered a stock purchase agreement with Marubeni America Corporation to acquire the grain and ingredients business of Gavilon Agriculture Investment.
“The addition of Gavilon supports our long-term strategy of significantly increasing our presence in the US, one of the major producing and exporting regions, which will further strengthen our global network,” says David Mattiske, CEO of Viterra Limited.
“The combination of the Gavilon and Viterra origination businesses will enable us to provide more value and flexibility to our customers. We will be able to rapidly enhance our sustainable supply chains, provide higher levels of quality control and reliability, while creating opportunities for our customers and employees,” explains Mattiske.
Gavilon is based in Omaha, Nebraska, the US, and originates, stores and distributes grains, oilseeds as well as feed and food ingredients, to food manufacturers, livestock producers, poultry processors, soybean processors and ethanol producers worldwide.
Advancing sustainable supply chains
Gavilon’s asset network is located in key growing areas in the grains and ingredients sector across the US, with access to major railroads, rivers and ports.
It also has international operations in Mexico, South America, Europe and Asia, along with an indirect minority ownership interest in two port terminals located in Kalama, Washington and Portland, Oregon.
“This transaction demonstrates the continued support of our shareholders to execute on opportunities that deliver significant growth for our business, while maintaining a robust balance sheet,” says Peter Mouthaan, chief financial officer at Viterra.
This acquisition move comes at a time when US consumers are eating more whole grains for their perceived health benefits, flavor and sustainability credentials, according to a recent survey of 1,505 adults. Since the COVID-19 pandemic, one in five US consumers say they are eating more whole grains, and half have increased their intake in the last five years.
Purchasing price approved
Funding for the agreed purchase price of US$1.125 billion and a portion of the assumed working capital has been secured through the signing of a committed acquisition financing facility.
Financing for the remainder of the working capital will be financed by using proceeds from other committed financing facilities and cash on hand, including existing available undrawn committed credit lines amounting to approximately US$3.6 billion as of 31 December 2021.
The transaction is subject to customary closing and regulatory approvals and is expected to close in the second half of 2022.
