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December 16, 2010

 

Cargill buys Australian grain-trading business of AWB from Agrium

 

 

Cargill Inc. agreed to purchase the Australian grain-trading business of AWB from Agrium Inc. , enhances its presence in a country forecast to be the world's fourth-largest wheat exporter this year.

 

Net proceeds from the sale would be about AUD870 million (US$859 million), according to Agrium. The figure is based on the buying price, the amount of working capital freed up due to the sale and AUD240 million (US$237) of debt that will be assumed by Cargill, Agrium said.

 

The purchase will consist of the former AWB grain marketing, trading and storage businesses, Minneapolis-based Cargill said. Australia may export 16 million tonnes of wheat in 2010-2011, after the US, France, and Canada, according to the forecast from the International Grains Council (IGC).
 
"Cargill's expertise and knowledge in shipping large volumes of commodities should make Australian grain more competitive in more markets," Ralph Selwood, the managing director of Cargill Australia Ltd., said.

 

The deal needs regulatory approval and the companies said they expect completion in the first half of 2011.

 

Cargill, founded in the US Midwest in 1865, has been in Australia since 1967, and employs about 1,500 people in Australia and New Zealand, the company said.

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