Tokyo-based Marubeni Corp. has discussed the possible sale of its U.S. grains unit Gavilon Group LLC with at least two other trading firms, Bloomberg reported on Sept. 30, citing people familiar with the matter. Talks are preliminary and no decision has been made, the people said. In response to Bloomberg inquiries, Marubeni denied that it has sounded out or approached trading firms for a potential sale of Gavilon and said it is not considering selling the unit. Gavilon declined to comment.
Marubeni bought Omaha-based Gavilon for $2.7 billion in 2013 in an effort to expand its sourcing of corn and soybeans to better compete with other top global grain traders in Asia. Since then, low commodity prices and the U.S.-China trade war have weighed on both companies, Bloomberg reported. More than two years ago, Gavilon was seen as a potential target for Glencore Plc as the Swiss company looked to enter the U.S. grains-trading market, but Gavilon denied it was looking for a buyer.
Nutrien Ltd., Saskatoon, Sask., on Sept. 30 announced the close of its acquisition of Ruralco Holdings Limited in Hobart, Tasmania. Nutrien said the combination of Ruralco’s business with its Landmark operations is expected to provide significant benefits for stakeholders and enhance the delivery of products and services to Australian farmers.
Nutrien announced in February 2019 that it had entered into a binding agreement to acquire all the shares of Ruralco at a price of A$4.40 per share, for a total purchase price of $469 million. Ruralco is one of Australia’s leading agriservices businesses, with 216 farm centers and more than 500 locations company-wide. Nutrien said it has steadily grown its retail business and earnings in Australia, with annual EBITDA expected to surpass US$230 million in 2020, of which approximately US$70 million is anticipated to come from the Ruralco acquisition, after accounting for expected synergies.
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