FEED Business Worldwide - June 2012
CHS and Zen-Noh form grain marketing joint venture
America's CHS Inc and Japan's Zen-Noh, two of the world's largest farm cooperatives, have entered into a joint venture called CZL Ltd, with CHS Inc holding 51% stake.
CZL Ltd will mainly export wheat and barley from the United States, Canada and Australia, to Japan, the top global destination for wheat and barley imports. The joint venture will be managed from the CZL office in Tokyo.
"CHS and Zen-Noh have been strong trading partners for more than 30 years," said Rick Browne, senior vice president, CHS Asia Pacific.
"This formal agreement strengthens CHS role in adding value to member-owners grain by aligning with these trusted partners in an important Asia Pacific market."
Browne says this partnership is particularly significant for CHS shippers and growers sending grain from the American Midwest and Pacific Northwest to export terminals in Kalama, Washington, Tacoma, Washington and Portland, Oregon.
"Strategically aligning grain origination with growing consumer demand is core to our continued global commodities expansion on behalf of our cooperative owners," Browne said.
CTB buys poultry processing equipment supplier Meyn
Under an agreement between America's CTB, Inc. and Sweden's Altor Equity Partners AB, CTB will acquire Amsterdam, Netherland's-based Meyn Holding B.V.
The latter is a parent holding company of poultry processing equipment supplier Meyn Food Processing Technology B.V. Meyn develops, manufactures, markets and exports poultry processing equipment to more than 90 countries.
"Meyn has under the ownership of Altor become the global leader in poultry processing solutions," said Han Defauwes, president and chief executive officer of Meyn. "Meyn has successfully developed its services to encompass the entire poultry processing value chain, providing market leading efficiency to the industry.
"With CTB as a new owner, we will be able to continue our successful strategy to further build our leading position in the poultry processing industry."
An Berkshire Hathaway company based in Milford, Indiana, CTB is a designer, manufacturer and marketer of poultry, layer, swine and grain processing systems. Meyn will become a new business unit of CTB, and Meyn's management will continue in the same roles.
Victor A. Mancinelli, president and CEO of CTB said, "The acquisition joins together leading companies in two distinct sectors of the poultry industry. The acquisition will provide CTB with the ability to offer global poultry companies total solutions from grow-out through the eventual processing cycle."
The transaction is pending approval by competition authorities and the Dutch works council.
Marubeni taking over Gavilon for US$3.8 billion
Japan's Marubeni Corp. intends to purchase Nebraska-based Gavilon for approximately US$3.8 billion and is in the final stages of negotiations with top shareholders. The latter include US investment firm Ospraie Management LLC.
Marubeni is one of Japan's largest trading companies and the world's sixth largest grain dealer, handling some 22.0 million tonnes of grain in the fiscal year ending March 31st 2012.
According to Japanese newspaper Nikkei Shimbun, with its acquisition of Gavilon, Marubeni will rival top ranked Cargill for number one rank in global grain handling, with each handling approximately 40 million tonnes of grain annually.
Nebraska-based Gavilon handles about 20.0 million tonnes of corn, wheat and other grains a year through 145 collection and operational facilities.
The planned purchase will mark one of the largest investments by a Japanese trading company outside the natural resources and energy field.
Marubeni declined to confirm the report, saying only that it "will make an announcement without any delay when decisions that should be open are made."
CP's Q1 profit jumps 229%
Integrated feed, livestock and processed meat provider Charoen Pokphand Foods (CP) saw a 61% revenue increase during the first three months of 2012. Sales reached THB73.5 billion (US$2.35 billion), with a net profit of THB12.1 billion (US$387 million), up 229% from the first quarter of 2011.
Adirek Sripratak, CP's president and chief executive, said the jump in net profit was mainly due to its acquisition of CP Pokphand Co (CPP), a listed company on the Hong Kong Stock Exchange, which functions as a holding company for some of the CP group's Asian national subsidiaries.
CP bought 74.18% of CPP for approximately THB66 billion (US$2.1 billion); CPP's two main businesses are animal feed production in China and integrated farm operations in Vietnam, the latter through its ownership of CP Vietnam Corporation (CPV).
Adirek said the purchase of CPP coupled with the use of international financial reporting standards helped the company book a THB8.67 billion (US$278 million) gain on fair-value adjustment of its direct and indirect investment in CPV. CPF has a 29% stake in CPV, while the rest is held by CPP.
Adirek said CPF plans to buy more international food processors, as it views M&As as an effective tools to boost growth.
With talks underway with three companies, some deals are likely to be concluded this year. Going forward, this Thailand-based integrator's foreign operations are becoming a key growth driver. Within three years, CP's non-Thai operations will account for 60% of revenues, up from 50% today.
Adirek said CPF invests in countries with high agribusiness industry growth potential. These include China, Vietnam, India, Russia and the Philippines. Within Thailand itself, the domestic market is maturing but the EU liberalization of Thai poultry exports will drive CP's domestic growth, along with export-oriented shrimp production.
Due to strong meat prices and a resumption of fresh chicken exports to Europe effective July 1st, CP's 2012 revenues are projected to total THB300 billion (US$9.6 billion).
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