Dive Brief:
- Olam International, the agriculture company controlled by the government of Singapore, will buy ADM's global cocoa operations for $1.3 billion.
- The move makes Olam, already a major player in rice, coffee, and other crops, into one of the biggest cocoa processors on earth, now rivaling Cargill and Switzerland's Barry Callebaut AG.
- The purchase comes a short time after Olam announced a much smaller acquisition of a U.S. peanut sheller.
Dive Insight:
ADM has already agreed to sell its chocolate business to Cargill in a $440 million deal. But that transaction did not include ADM's cocoa processing capability - an omission that suggested perhaps ADM wanted to keep its hand in the ingredients side of chocolate. This new deal with Olam shows that ADM may want nothing to do with the wildly volatile prices of cocoa and chocolate.