A move by US oil processor Bunge to purchase French oil seed company Cereol looks set to push it into the number one slot, ahead of Cargill, as the world's largest soybean processor. Ingredients company Central Soya, a subsidiary of Cereol, welcomed the move this week.
""We at Central Soya are very excited about becoming part of Bunge, soon to be the leading oilseed processor in the world," said Carl Hausmann, President and CEO of Central Soya and Chairman and CEO of Cereol. "The combined company will provide more opportunities for our employees, it will provide our customers access to a broader range of products and it will give producers access to more markets around the world."
Analysts maintain that although the US market is more mature, Bunge will be able to achieve more efficiencies and economies of scale out of the US operation because it will gain control of Central Soya, a soybean processor with plants in the Eastern Corn Belt of the US that complement Bunge's own operations in the Western Corn Belt and along the Mississippi.
The acquisition, due for completion in early 2003, is likely to take several months and is subject to regulatory review.
In a statement this week Central Soya sought to reassure customers that for the moment, and in the immediate future, changes are not anticipated.
"For our customers and employees, it will be business as usual for the next few months while the transaction is being completed," continued Haussmann.
With the acquisition of Cereol, acquired from Italian energy company Edison, formerly part of agro-industrial Italian conglomerate Montedison, Bunge is the second US grain giant to acquire a strong stake in the European ingredient market this year. Bunge's grain competitor Cargill completed the purchase of French starch producer Cerestar, also from Montedison, in April this year. For both companies the appeal of the Eastern European market, as yet unsaturated, has clearly held an appeal.
As the US giants enter the ingredients arena with force, smaller European operations must prepare themselves for a difficult ride.