Olam, Mitsubishi tie-up for marketing agri products in Japan

Olam, Mitsubishi tie-up for marketing agri products in Japan

The partnership will explore potential strategic collaboration opportunities that could cover Olam's key platforms including edible nuts, coffee, packaged foods and rice

Source: PTI

Global agri business group Olam International Limited, which has its roots in India, has entered into a $652 million deal with Japanese trading giant Mitsubishi Corporation for marketing agri products in Japan, the company said on Friday. Singapore-based Olam is raising 915 million Singapore dollars (US$652 million) through the share subscription with MC, which is also acquiring a stake in secondary shares from Singapore-Indian group Kewalram Chanrai Group. Following the transaction, MC will become Olam's second largest shareholder with 20% shareholding. The partnership will explore potential strategic collaboration opportunities that could cover Olam's key platforms including grains, edible nuts, cocoa, coffee, packaged foods and rice. Singapore state investor Temasek Holdings will remain Olam's majority shareholder with a 51.4% controlling stake in the enlarged issued and paid-up share capital. Olam's Co-founder, Group Managing Director and CEO Sunny Verghese said, “I am pleased to welcome Mitsubishi Corporation as a long-term strategic shareholder in Olam. We have been business partners for many years and share a lot of the same goals and beliefs about the future of our sector and the attractive long term prospects that it offers. “I am confident that this partnership with Mitsubishi will provide several sources of synergy which will help accelerate Olam's growth and harness its full potential.” Group CEO of MC's Living Essentials Group Takehiko Kakiuchi said, “Today is a memorable day for the partnership between Olam and Mitsubishi. In addition to raw materials procurement and product manufacturing in the Japanese market, Mitsubishi has been developing a vertically integrated model in distribution and retail.  “Combining our processing, manufacturing and downstream business experience with Olam's extensive sustainable raw material supply platforms, we will transform the business into a globally sustainable model, both in qualitative and quantitative terms, while we build a value chain that is closely connected to the needs of customers.” Olam's Executive Director of Finance and Business Development A Shekhar said, “This transaction is consistent with the objectives of the successful voluntary general offer that was concluded in May 2014 where we sought to change our shareholder profile and attract more long-term shareholders to our register.” Established in 1989 by Kewalram Chanrai Group, Olam is trading in 44 commodities in 65 countries including India. From a small beginnings in 1860 as a textile trading company in India, the Group developed businesses in handicrafts, agricultural commodities and bullion trading.  

August 28, 2015 | 4:27pm IST.

 

The Dollar Business Bureau - Aug 28, 2015 12:00 IST