CHICAGO — Archer Daniels Midland Co. on Oct. 16 announced it had completed the sale of its global cocoa business to Olam International Ltd. The sale was valued at about $1.2 billion, subject to finalization of the post-closing adjustments. About 1,500 ADM employees will transfer to Olam.
While ADM expects improved returns after the divestiture, Olam International may promote a fully integrated cocoa supply chain.
|Juan Luciano, c.e.o. of ADM|
“I am tremendously proud of the work our entire global team is doing as we continue our journey to improve returns,” said Juan Luciano, chief executive officer of Chicago-based ADM. “We are delivering on a clear, aggressive plan to create value through strategic growth, an increased focus on operational efficiencies, and, when necessary, the divestiture of businesses that we believe are unable to meet, in the long run, our returns objectives.”
The sale, first announced on Dec. 15, 2014, includes processing facilities in Mississauga, Ont.; Koog aan de Zaan, The Netherlands; Wormer, The Netherlands; Mannheim, Germany; Ilhéus, Brazil; Abidjan, Cóte d’Ivoire; Kumasi, Ghana; and Singapore. Also included were ADM’s buying stations in Brazil, Cameroon, Cóte d’Ivoire and Indonesia, and ADM’s deZaan and Unicao brands.
Olam International said its acquisition brings together the cocoa bean sourcing capabilities of Olam and the cocoa processing capabilities of ADM Cocoa to create a new entity called Olam Cocoa. Olam International estimated the closing value at $550 million in fixed assets and $654 million in working capital, subject to the usual purchase price adjustment post-closing.“Olam Cocoa is now a leading, global integrated supplier of cocoa products,” said Sunny Verghese co-founder, group managing director and c.e.o. of Singapore-based Olam International. “This is a transformation of an already strong, prioritized business platform with attractive market prospects that is poised to contribute significantly to EBITDA by 2018.”