Bunge Ltd has offered to buy two soy processing plants in Brazil from local crusher Imcopa, the U.S. grains trader said on Tuesday, reinforcing its position as the country’s biggest oilseeds processor.
Two sources familiar with the transaction told Reuters that Bunge agreed to pay about 50 million reais ($12 million) for the plants while assuming debt of around 1 billion reais related to the assets, located in the state of Paraná.
In a statement, Bunge confirmed making a bid for the assets, adding that it was awaiting a court decision to continue with the process. It declined to give more details.
Bunge was the only company to submit a bid in the auction, according to one of the sources.
Imcopa, now restructuring debt in bankruptcy court, said in a statement that it had received one offer for the plants on Monday, although it did not name the bidder.
Bunge is already Brazil’s top oilseeds processor, and the move will help it expand a lead over rival Cargill Inc, which has two-thirds as many crushing and refining facilities, according to data from national oilseeds group Abiove.
According to Abiove data from 2018, Cargill owned eight active oilseed crushing units in Brazil and Bunge owned 12.
“Bunge not only intends to acquire the two industrial plants … (it also) intends to hire a significant number of the current employees,” according a filing Bunge made to the bankruptcy court dated Nov. 26.
On Imcopa’s website, the company touts capacity to crush 1.5 million tonnes of soybeans per year, producing up to 240,000 tonnes of soy protein concentrate.
The minimum asking price of each of the plants was 25 million reais in an auction scheduled for Feb. 17, according to bankruptcy court documents. The debt attached to the plants was 1.043 billion reais in December 2018, public records show.
Last year, Imcopa ended a leasing contract with Brazilian brewer Grupo Petrópolis for use of the two crushing plants, alleging a breach of contract, and put the assets up for sale.
The leasing agreement was set to expire in 2024. Petrópolis declined to comment on Bunge’s bid to assume control of the two Imcopa plants.
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