Bunge buys 70% of IOI Loders Croklaan for US$946m

AGRIBUSINESS and food giant Bunge has bought a 70% controlling stake in IOI Loders Croklaan from Malaysian palm oil giant IOI Corporation for US$946m.

IOI Loders Croklaan is a semi-specialty and specialty business-to-business fat and oil supplier, making a range of bulk and specialty products from palm and other tropical oils such as shea and coconut. Its customers include those in industrial food processing, industrial and artisanal bakery, confectionery, and infant nutrition. It is one of the founding members of the Roundtable on Sustainable Palm Oil (RSPO). It has seven manufacturing facilities in Europe, North America and Asia.

Bunge CEO Soren Schroder said that the purchase will expand its value-added business, one of the company’s stated objectives. He added that the two companies will have a comprehensive seed and tropical oil product offering. Bunge will benefit from IOI Loders Croklaan’s customer and market knowledge, and application development.

IOI Loders Croklaan will, in turn, gain access to new markets in Latin America, Africa and India. The company says Bunge shares its sustainability commitments, including zero deforestation, zero peat conversion, human rights protection, traceability and transparency.

IOI Corporation said that the deal with Bunge has followed a period of discussion between the two companies about collaboration. IOI will have two representatives on the Loders board and continue to be a major supplier of palm oil and palm products to Loders.

“Together, we will be a leader in innovation with global applications capabilities, making us the supplier of choice to our customers. I also expect Loders employees to benefit as they become part of a larger, global organisation. We look forward to working with the Bunge team to maximise the opportunities that this transaction creates,” said Loders CEO Julian Veitch.

IOI Corporation will retain a 30% stake in IOI Loders Croklaan, which it bought from Unilever in 2002. The deal is expected to be completed within a year, subject to regulatory and shareholder approval.