China’s COFCO to become a global player in agribusiness


China’s state-owned grain giant COFCO said on Friday it had bought a majority stake in Netherlands-based commodity trader Nidera for a reported US$1.2 billion, as it seeks to become a global player in agribusiness.

COFCO’s deal to buy 51 per cent of Nidera, which trades grains and soybeans among other agricultural commodities, is the latest in a string of major overseas investments by Chinese companies seeking to meet rising demand for food and energy in the world’s second-largest economy.

The deal would give China greater control over pricing on the world’s grain markets as well as better access to major grain-growing regions, such as Latin America and Russia, Dow Jones Newswires reported.

Financial terms of the COFCO-Nidera deal, which awaits regulatory approval, were not disclosed while the press release described Nidera as having “annual turnover in excess of US$17 billion”.

“Investing in Nidera is in line with COFCO’s strategy to become a global player in the agricultural industry … and represents a significant step towards COFCO’s global expansion,” Frank Ning, COFCO’s chairman, said in a press release.

Nidera’s total enterprise value is about US$4 billion, Dow Jones Newswires reported citing people familiar with the matter, adding that the equity value of COFCO’s stake is about US$1.2 billion.

Nidera’s operations in Brazil, Argentina and Central Europe and global trading network “can further extend COFCO’s global presence and create new opportunities,” Patrick Yu, COFCO’s president, said in the release.

As China’s population grows wealthier, foreign companies are widely seen by consumers as offering safer and higher quality products in contrast to a climate of constant food safety scares in the fast-growing Asian economy.

Ton Van Der Laan, CEO of Nidera, said the deal would “generate great growth opportunities”, emphasising the importance of Chinese and Asian markets for the company.

“We were looking for a strong partner to jointly invest in future growth and a strategic partnership with COFCO is an ideal choice for Nidera and will benefit both sides,” Van Der Laan said.

China’s overseas investment rose 16.8 per cent to US$90.17 billion in 2013 as its companies bought more foreign assets, particularly in energy and resources, to power its economy.





Source : Channel News Asia | March 1, 2014


About thomasdinnocenzi

Thomas D'Innocenzi is a highly accomplished, results-focused senior international executive with extensive experience in global sourcing and market development worldwide to meet evolving business needs. Tom has proven ability in implementing and managing profitable global sourcing operations worldwide. Extensive experience in international market development operations to accommodate rapid growth. Skilled in building top-performing teams, benchmarking performance, and restricting organizations to improve efficiency, productivity, and profitability. Experienced transition leader and change agent. As principal of Nova Advisors, LLC I’ve assembled an exemplary team that brings with them the knowledge and experience gained from starting up a Global Sourcing program with multiple Fortune 500 companies as well as the largest supplier network throughout the Asia-Pacific region. We have experience and expertise in more than a thousand medical and pharmaceutical products in manufacturing and sourcing at the best value. The right product, the right price point and the right branding fueled these successes that resulted in double-digit growth for top line sales and bottom line net margins for our customers. What sets us apart: • Our reach includes a large network of suppliers & manufacturers spanning 13 countries in Asia-Pacific region • We understand the manufacturing process and the business of the supplier and the buyer • Our company culture is based on quality assurance and our process is based on local quality control Our commitment is to be your partner offering the best products and services at the lowest cost. Contact me to discuss how we can make the global marketplace work for you. In addition, I am open to discussing opportunities in global sourcing, international marketing & sales, logistics and medical/pharma in Thailand, Vietnam, Malaysia, Philippines & Japan. Aside from my work I enjoy piano, astronomy, physics, and assisting my daughters with their studies. SPECIALTIES: Global Sourcing, Supply Chain Management, Business Development, Marketing, Logistics, Global Networking, Market Development, Healthcare Solutions, Pharmaceuticals, Medical Devices, Technology, Asia, Southeast Asia, US and Canada
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