Dive Brief:
- Olam International Ltd., an Asian food trader controlled by Singapore’s state investment company, Temasek Holdings Pte, is "begging to enter a buyer’s market" with S$2.72 billion (about $1.9 billion) set aside for future acquisitions, Sunny Verghese, CEO of Olam, told Bloomberg.
- The announcement of Olam's acquisition plans comes not long after Mistubishi Corp. acquired a 20% stake in Olam for $1.1 billion.
- These recent moves could be "a sign that Asian trading houses are betting growth of populations and wealth in the region will spur demand for higher-quality food," according to Bloomberg.
Dive Insight:
Olam isn't a known name yet like some of its competitors, namely those referred to as ABCD: Archer Daniels Midland Co., Bunge Ltd., and Cargill Inc., and Louis Dreyfus Commodities. But with acquisitions in the $100 million to $200 million range, which Verghese called the company's "sweet spot" in a Bloomberg interview, Olam plans to affirm its presence in the agricultural commodities market.
Already, Olam says that one in eight chocolate bars eaten across the world is made from cocoa beans the company handles. That statistic will most likely be affected by Olam's $1.3 billion acquisition of ADM's cocoa business, which is expected to close next month.