Glencore plc, the Canada Pension Plan Investment Board and British Columbia Investment Management Corporation, the shareholders of Viterra Limited, have concluded an agreement with Bunge Limited to merge Bunge and Viterra in a cash and stock transaction to create a premier diversified global agribusiness solutions company, as announced by Bunge today.
Under the terms of the agreement, Glencore will receive approximately $3.1 billion in Bunge stock and $1.0 billion in cash for its c. 50% stake in Viterra1 resulting in Glencore then holding c. 15% in the combined group2.
The transaction would result in a larger, more diversified business, with significant synergy and re-rating potential. Glencore has agreed to not sell any stock in Bunge for a period of 12 months following the completion of the merger, and thereafter to only sell Bunge shares in orderly sales. Glencore will review periodically its strategy in respect of the shareholding.
The merger, subject to satisfaction of customary closing conditions, including receipt of regulatory approvals and approval by Bunge shareholders, is expected to close in mid-2024.
Gary Nagle, CEO, Glencore, commented:
“The merger of Viterra with Bunge is expected to realise significant value for Glencore. Our investment in the agriculture sector dates back over 40 years and has grown from being a small grains trader to being part of a world leading, fully integrated global agriculture network.
The combined group would be a premier pure-play agribusiness solutions company, well placed to meet increased global demand as well as the ongoing challenge of providing sustainable, traceable food and feed products to customers around the world. This would be underpinned by a rigorous focus on creating value for all stakeholders.”
Note 1: Glencore to receive 32.8 million shares valued at approximately $3.1 billion as per the last closing price of $93.79 on Monday, 12 June 2023.
Note 2: before the commencement of Bunge’s announced $2 billion share buyback programme.
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