The European Commission (EC) has approved Bunge Global’s acquisition of Viterra on condition that the companies divest of Viterra’s oilseed businesses in Hungary and Poland and logistical assets connected to those operations, World Grain wrote.
Last June, Bunge and Viterra announced they had agreed to a merger that would create one of the world’s largest agribusiness companies, moving it closer in size and scope to leading agribusiness giants Cargill and ADM, the 2 August report said.
In its 1 August announcement, the EC said as initially proposed the merger would have reduced competition in European Union (EU) markets for oilseeds and related products, including oilseed meals for animal consumption, crude oilseed oils and refined oilseed oils for human consumption or for biodiesel production.
In particular, the transaction would have negatively affected competition in Central Europe, where both parties are active across the whole supply chain, the EC said, noting the potential for concentration of oilseed processing capacity in the region.
Following positive feedback during the market test, the EC concluded that following the recommended modifications the transaction would no longer raise competition concerns.
The decision was conditional on full compliance with the modifications, which would be monitored by an independent trustee under commission supervision.
“Preventing market concentration in agricultural supply chains is crucial for both farmers and consumers,” EC executive vice president in charge of competition policy Margrethe Vestager said.
“We had concerns that the transaction could affect the supply chains of rapeseed and sunflowerseed in Central Europe, with potential ramifications across the food, feed, and biofuel industries. The divestiture of Viterra’s entire oilseeds business in Hungary and Poland will preserve competition in these markets.”
Regulatory approval for the transaction would also be needed in North and South America and China, World Grain wrote.
Headquartered in the USA, Bunge is mainly active in processing, selling and trading of oilseed meals and oils. The company also sells grains, milled products and unprocessed oilseeds, sugar and other agricultural products.
Viterra, which is headquartered in the Netherlands, trades agricultural commodities including grains, oilseeds and oilseed-based meals as well as oils. The company also sells other unprocessed products, such as cotton, and milled products.
