February 9, 2012

Mitsui to acquire 40% shares in China's grain logistics firm

Mitsui & Co. will acquire 40% shares in Chinese firm Beidahuang Grain Logistics Co, in a bid to gain market entry to the local grain logistics in China.

Mitsui will be allocated new shares in Beidahuang Grain Logistics sometime between spring and summer this year after Chinese government approval. The value of its investment was not disclosed.

Mitsui aims to use know-how gained from its grain businesses in North and South America for the collection, sale and distribution of corn and soys in the growing Chinese grain market.

Based in Heilongjiang Province, one of China's largest grain-producing regions, Beidahuang Grain Logistics handled 1.61 million tonnes of grain in 2011, for sales of RMB3.6 billion (US$0.57 billion).

Beidahuang Grain Logistics plans to expand its grain collection facilities using the capital injection from Mitsui, while increasing operational efficiency. By 2015, it aims to handle five million tonnes of grain, for sales of RMB10 billion (US$1.6 billion).