The deal was first announced in June 2023, with Bunge confirming it had agreed to merge with Viterra in order to create an “innovative global agribusiness company”.
Bunge specialises in the processing, sale and trading of oilseed meals and oils, while Viterra also trades oilseed meals and oils as well as commodities such as grains.
The agreement was subsequently investigated by the European Commission, which found that the merger would reduce levels of competition in the markets for oilseeds and related products.
In particular, it was feared that the transaction would negatively impact competition in Central Europe due to the considerable concentration of oilseed processing capacity in the region.
In response, the firms offered to divest the entirety of Viterra's oilseed businesses in Hungary and Poland and a number of logistical assets linked to these operations, which allayed EU fears.
As a result, under the EU Merger Regulation, the deal was approved earlier this month (August 2024) on the condition that the above commitments are followed through on.
“Preventing market concentration in agricultural supply chains is crucial for both farmers and consumers,” said Margrethe Vestager, executive vice-president in charge of competition policy.
“We had concerns that the transaction could affect the supply chains of rapeseed and sunflower seed in Central Europe, with potential ramifications across the food, feed, and biofuel industries. The divestiture of Viterra’s entire oilseeds business in Hungary and Poland will preserve competition in these markets.”
Details of the deal
Under the agreement, Viterra shareholders will receive approximately 65.6m shares of Bunge stock, with an aggregate value of approximately $6.2bn, and approximately $2bn in cash.
Bunge has also agreed to take on $9.8bn in Viterra debt and will repurchase an additional $2bn of Bunge stock.
Speaking at the time, the firm’s CEO Greg Heckman said: “The combination of Bunge and Viterra significantly accelerates Bunge’s strategy, building on our fundamental purpose to connect farmers to consumers to deliver essential food, feed and fuel to the world.
“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.”
Meanwhile, Viterra chief executive David Mattiske said that the deal better positioned the firm to meet growing demand around the world.
“This further enables us to offer innovative solutions and open additional pathways for our customers. We will create value for stakeholders across our network, as we build on our shared purpose to connect producers and consumers around the world,” Mattiske added.
In other news, Modern Baker has secured listings with Sainsbury’s and Morrisons for its re-engineered UPF bread brand Superloaf.
