Dive Brief:
- Archer Daniels Midland Co. has completed the sale of its global cocoa business to Olam International Ltd. The deal was initially announced in December 2014.
- The sale is potentially worth about $1.2 billion, though finalization of the post-closing adjustments could change that value. About 1,500 ADM employees moved to Olam along with the sale.
- "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. With each new acquisition, divestiture and strategic investment, we are advancing our plan and making our company stronger and our future brighter," CEO Juan Luciano said in a news release.
Dive Insight:
Cocoa has remained a volatile sector, particularly in terms of price, as crops across the globe, but particularly in Ghana, have been affected by adverse weather conditions and other factors.
With this sale, Olam, which is already a major player in rice, coffee, and other crops, is now one of the world's biggest cocoa processors and a rival to cocoa giants like Cargill and Barry Callebaut AG.
ADM sold its global chocolate business to Cargill.