U.S. group Cargill, one of the world's largest marketers, processors and distributors of agricultural products is planning to significantly increase its presence in Romania.
The company is now in advanced talks with American fund Broadhurst to buy one of the main Romanian grain stocking and conditioning companies - Comcereal SA, according to market sources.
Comcereal SA holds some 10% of the total grain storage capacity available in Romania, whereas the transaction's value could revolve around 15-20 million dollars, quoted sources say.
Comcereal SA resulted from the merger of four companies - Comcereal Alexandria, Galati, Giurgiu and Slobozia. Broadhurst holds the main stake in the company, as it has acquired shares from the Rasdaq market in the past few years. The Broadhurst investment in the four companies is estimated at 9-10 million dollars.
Broadhurst manager Cristian Siminel Andrei would not comment on the information regarding the negotiations over the ComCereal sale. Cargill officials did not provide any details to Ziarul Financiar by press time.
Cargill has been operating in Romania since 1996, through its Cargill Agricultura SRL subsidiary. The American group, one of the main players on the worldwide market of agricultural products, already owns a plant and several storage capacities in Calarasi.
According to the quoted sources, the Comcereal takeover was prompted by the company's sunflower storage and conditioning capacities. The world has been facing a significant sunflower deficit for several years, while the main companies dealing in agriculture are trying to overcome the crisis by taking over the storage facilities located near the big agricultural areas.
The same situation occurs on the Romanian market, where two of the main companies operating on the sunflower oil market (Topway and Argus) have tried to secure the raw material supply by purchasing storage spaces.
The Romanian company controlled by Broadhurst comes with one more perk - three of the four Comcereal SA subsidies (Alexandria, Galati and Giurgiu) are located near Danube harbours, which is great for trade.
Comcereal SA is one of the main players also because the grain storage market is highly fragmented. Besides Broadhurst, the market also counts investors such as SIF Banat-Crisana, SIF Muntenia, SIF Oltenia, European Drinks Group (controlled by the Micula brothers), Rompac International and Interagro (controlled by businessman Ioan Niculae).
Comcereal SA last year posted turnover worth 673.28 billion ROL (some $21m)
Gargill Group had revenues worth $50.8bn last year and net income of $827m.
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