If you would like to send us an article, contact Margaret Stacey
The purchase of Provimi is a relevant step towards Cargill's growth in the animal nutrition market. (Photo: Provimi/FIS)
Cargill makes EUR 1.5 bln-bid on animal nutrition company
(NETHERLANDS, 8/18/2011)
US-based Cargill has followed up on its plan to acquire global animal nutrition company Provimi and made a binding offer of EUR 1.5 billion. Private equity firm Permira-owned Provimi has agreed to commence the necessary Works Council consultations and appropriate regulatory approvals on an exclusive basis.
Animal feed giant Nutreco and chemicals company DSM have since dropped their bids for Provimi, DutchNews reports.
Netherlands-based Provimi’s worldwide animal nutrition business entails operations in 26 countries and more than 7,000 workers across Asia, Europe, Africa and Latin America. The purchase would fortify and expand Cargill’s operations, turning it into a new universal leader in animal nutrition.
“The combination of Cargill and Provimi would create a new, world class animal nutrition offering with the expertise to offer customers a full range of enhanced products and services,” said Paul Conway, Cargill vice chairman. “This acquisition would mark a significant step in Cargill’s animal nutrition growth strategy and underlines our commitment to continued long term investment to meet the needs of our customers around the world.”
This deal will benefit Permira by letting it earn about 2.3 times its initial equity investment, allowing the firm to return cash to its investors before it commences fundraising efforts next month. Permira originally took over Provimi four years ago in a deal valuing the business at EUR 1.5 billion, Reuters reports.
The companies have complementary market positions and strengths: Provimi has broad nutritional expertise and broad experience in premix, additives and ingredients; Cargill brings expertise in compound feed, supply chain and risk management and access to global trends, knowledge and information from across the agricultural supply chain.
“Bringing together the talents and expertise of both companies is expected to open up new innovation and market development opportunities,” commented Todd Hall, Cargill corporate vice president. “Provimi’s excellence in cutting edge technology and application, alongside Cargill’s global supply chain and market insights should enable us together to develop and deliver a range of innovative, high quality products and services to customers.”
Ton van der Laan, chairman and group CEO of Provimi, said Cargill made a compelling offer.
“Cargill provided a clear and compelling case to become our new owner and we believe that a combination of its animal nutrition business with Provimi will create a stronger business, improving the delivery of innovative nutritional solutions to our customers. With Cargill’s global presence and committed focus on animal nutrition, we can take Provimi to the next stage of its development,” van der Laan stated.
Provimi believes its takeover can be completed by the end of 2011, MarketWatch reports.
Among Cargill’s key acquisitions in recent years was Agribrands in 2001 and feed producer Provimi Kliba in 2002.
Cargill was founded in 1884 and currently has animal feed operations in 26 countries.
(NETHERLANDS, 8/18/2011)
Print
