US agribusiness group Archer Daniels Midland Co said on Thursday it had agreed to buy the remaining 50% stake in British grain merchant Gleadell it does not already own from French co-operative InVivo.
Gleadell, based in Gainsborough in eastern England, is one of Britain's largest traders of grains, oilseeds and pulses. Competitors include Cargill and Associated British Foods joint venture Frontier Agriculture and co-operative Openfield.
The deal, which includes Gleadell's wholly-owned subsidiary Dunns (Long Sutton) Ltd, is expected to close in the first quarter, ADM said in a statement.
Terms of the deal were not disclosed.
Better Capabilities
The US group plans to merge Gleadell and Dunns with its British units ADM Arkady and ADM Direct UK to create ADM Agriculture Ltd, it added.
"The transaction will increase ADM's origination, storage and destination marketing capabilities in the UK," the statement said, noting Gleadell was a major exporter to European Union markets and further afield.
Key assets include port storage and ship loading operations along with extensive pulse and agricultural seed processing.
"ADM and InVivo are convinced that Gleadell should develop a robust project firmly based on its domestic market. The strategy of InVivo, meanwhile, is more based on sourcing from French cooperatives for exporting outside the EU," Stephane Bernhard, InVivo's head of trading, said in an emailed statement.
ADM's CEO said in an interview with Reuters published on Wednesday that it had looked at buying rivals including Bunge Ltd. but decided the time was not right for "monster" acquisitions.
News by Reuters, edited by ESM. Click subscribe to sign up to ESM: European Supermarket Magazine.
