Glencore sells 40% stake in agricultural business for $2.5bln
Glencore said on Wednesday that it had sold 40% of Glencore Agricultural Products (Glencore Agri) to the Canada Pension Plan Investment Board (CPPIB) for $2.5-billion in cash.
The distressed diversified natural resource company said it would use the proceeds to pay down debt.
Built around a network of assets, including 200 storage facilities and 31 processing plants around the world, Glencore Agri is a significant international player in the trade of agricultural commodities including grains, oilseeds products, rice, sugar, pulses and cotton.
Welcoming the deal, Glencore chief executive Ivan Glasenberg, said: “CPPIB have a proven track record in the sector and share our vision for the future growth of the business through value-creating organic and inorganic growth opportunities.”
CPPIB’s senior managing director Mark Jenkins said: “As an asset class, agriculture is an excellent fit for a long-term investor like CPPIB … Glencore Agri complements our existing portfolio of agriculture assets, bringing global exposure, scale and diversification.”
The deal, which is subject to regulatory approvals, is expected to close during the second half of the year.
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