Marubeni completes acquisition of Gavilon

by Eric Schroeder
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OMAHA — Marubeni Corp. said on July 5 that it has completed its previously announced purchase of Gavilon Holdings L.L.C., with the exception of its energy business.

Marubeni paid $2.7 billion for the company. Marubeni said it had obtained all necessary approvals from relevant competition authorities, including the Chinese competition authority, and fulfilled all other closing conditions as agreed upon in the Equity Interest Purchase Agreement.

Marubeni’s grain business operates as part of its Food Materials Division. The division is the top trader among general trading companies with annual grain trading volume of about 20 million tonnes, Marubeni said, and the company is bolstering efforts to develop sales operations worldwide, along with measures targeting grain production markets. Additionally, the company has a framework for grain procurement composed of diverse production sites worldwide, and it is developing global sales operations. Leveraging internationally competitive grains, the division not only provides Japan with a stable grain supply, but also is building a structure for flexibly supplying grain to meet growing global demand.

Privately-held Gavilon, one of the largest grain, processing and merchandising companies in the United States, was established in 2008 with the sale by ConAgra Foods Inc. of its Trading and Merchandising business to Ospraie Management L.L.C. Special Opportunities Fund in a $2.1 billion transaction. With the sale, the business was renamed Gavilon L.L.C. Ospraie remains the principal owner of the business.

Since it became a privately-held company, Gavilon has grown rapidly with a number of significant actions, including acquisitions and capital expenditures. Gavilon operates 300 facilities and regional offices worldwide. The company estimated its business mix, as measured as share of earnings, at 62% grain and ingredients (mostly origination, storage and distribution), 20% energy (storage, transportation and logistics) and 18% fertilizer (distribution).

According to the 2012 Grain & Milling Annual, Gavilon was the third largest grain storage company in the United States.

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