China’s largest food company COFCO is planning to merge its international trading arm with several domestic businesses to create an agribusiness giant, Global AgInvesting reported on 16 March.

State-owned COFCO owns a 60% stake in its international trading arm COFCO International with the remainder owned by five partners: Temasek, Standard Chartered Bank, China Investment Corporation, Hopu Investment Management, and the International Finance Corporation of the World Bank, according to Global AgInvesting.

If it goes ahead, the merger would bring together COFCO International’s trading unit and other domestic businesses under one name, resulting in a global giant with assets across multiple continents, the report said.

The merger would be followed by an initial public offering (IPO) – likely to take place in Shanghai – of the new entity.

The merger plan followed a posting of record profits by COFCO International, with unaudited pre-tax profits more than US$350M in 2020, Global AgInvesting wrote.

Founded in 1949, China Oil and Food Corporation (COFCO)’s core business is based on grain, edible oil, sugar and cotton. According to its website, COFCO has total assets of CNY560.6bn (US$85.44bn), an annual revenue of CNY471.1bn (US$71.8bn), processing capacity of 90M tonnes/year and an annual port transit capacity of 65M tonnes.

In China alone, COFCO has an integrated processing capacity of more than 60M tonnes and is China’s largest food processing company, with products including rice, wheat, corn, edible oil and oilseeds, sugar, cotton, meat and dairy products, wine and tea.

On the global stage, COFCO said it was an industry leader in rice, wheat, corn, edible oil, oilseeds, sugar and cotton in over 140 countries, earning more than 50% of its operating income from overseas business.