Viterra opens up for bidding war, shares jump

Thu Mar 15, 2012 5:49pm EDT
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By Rod Nickel and Victoria Howley

WINNIPEG, Manitoba/LONDON (Reuters) - Canada's largest grain handler, Viterra VT.TO, said on Thursday it has opened its books to potential buyers, setting the stage for a possible bidding war and sending its shares 10 percent higher.

Viterra said it has established a process for considering expressions of interest, including confidentiality agreements.

It shed no light on who might bid, but a person familiar with the matter said that Swiss-based Glencore (GLEN.L: Quote) and U.S.-based Bunge (BG.N: Quote) and Archer Daniels Midland (ADM.N: Quote) were involved in the auction.

"This is a public company, it won't take that long to resolve an outcome," the person said.

Another person said that Glencore made a very strong case to support an acquisition. "They have given a lot of thought to this. They are very motivated," the second source said.

The Financial Times said Glencore was teaming up with two Canadian companies, grain handler Richardson International and fertilizer company Agrium Inc (AGU.TO: Quote) on a joint bid.

A Richardson spokeswoman said the company would not comment on speculation, while ADM and Bunge declined to comment. An Agrium spokesperson could not be immediately reached.

Viterra, based in Regina Saskatchewan, stands to gain from a government decision to end the Canadian Wheat Board's monopoly on Western Canadian wheat and barley sales, as the change will let grain handlers buy wheat and barley for milling or export directly from Prairie farmers for the first time in 69 years.   Continued...