Bunge and Viterra to merge in $34bn megadeal

September 2023 | DEALFRONT | MERGERS & ACQUISITIONS

Financier Worldwide Magazine

September 2023 Issue

In a drive to meet the demands of increasingly complex markets and better serve farmers and end-customers, US agribusiness and food company Bunge Ltd has merged with Canadian grain handling business Viterra Ltd in a transaction valued at $34bn.

Under the terms of the definitive agreement, Viterra shareholders will receive approximately 65.6 million shares of Bunge stock, with an aggregate value of approximately $6.2bn, and approximately $2bn in cash, representing a consideration mix of approximately 75 percent Bunge stock and 25 percent cash.

In addition, the transaction – which has been unanimously approved by the boards of both companies – will see Bunge assume $9.8bn of Viterra debt, which is associated with approximately $9bn of highly-liquid readily marketable inventories.

Headquartered in St. Louis, Missouri, Bunge has almost 23,000 employees working across approximately 300 facilities located in more than 40 countries. Acquiree Viterra has more than 17,500 employees operating in 37 countries, with a strategic network of agricultural storage, processing and transport assets enabling it to offer innovative solutions and open pathways for its customers.

Combined, the highly complementary organisations will benefit from more diversified capabilities, greater operational flexibility across oilseed and grain supply chains and processing, greater resources, and combined employee talent to innovate and deliver for customers in every environment, creating value for all stakeholders.

Moreover, with an enhanced global network, the combined company’s increased diversification across geographies, seasonal cycles and crops will increase optionality in managing risk and increase resiliency.

“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,” said Greg Heckman, chief executive of Bunge. “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.”

Following the close of the transaction, the combined company will be led by Mr Heckman and John Neppl, chief financial officer at Bunge. David Mattiske, chief executive of Viterra, will join the Bunge executive leadership team in the role of co-chief operating officer.

“Viterra and Bunge are two leading agriculture businesses,” said Mr Mattiske. “In combining our highly complementary origination, processing and distribution networks, we are better positioned to meet the increasing demand for the food, feed and fuel products we offer. Together, we will play a leading role in the future of the agriculture industry, developing fully traceable, sustainable supply chains and moving towards carbon-neutral operations, while creating a strong growth platform for our combined business.”

The merger is expected to close in mid-2024, subject to satisfaction of customary closing conditions, including receipt of regulatory approvals and the approval of Bunge shareholders.

Acting as financial adviser to Bunge is BofA Securities, with Latham & Watkins LLP acting as legal counsel.

Mr Mattiske concluded: “The combined talent and experience of our workforce will allow us to offer a truly world-leading service across everything we do.”

Fraser Tennant