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Japan : Mitsubishi Corporation Acquires Stake in Olam International
Publish Date : 31-Aug-2015
Mitsubishi Corporation (MC) is pleased to announce an agreement reached with Olam International (Olam or the Company) of Singapore for subscribing to 332.73 million new shares in the Company giving it a 12% stake of the enlarged issued and paid up capital of the Company. It is also pleased to announce that it is acquiring 222.0 million secondary shares from the Kewalram Chanrai Group, who are the original promoters of Olam, which will give it a combined 20% stake of the enlarged issued and paid up capital of the Company, following completion of both these transactions.
As MC seeks to accelerate business development globally while contributing to providing a stable supply of resources to consumers around the world, one area of increased focus is agricultural production-related businesses, including farming, trading and processing. In particular, the company has been expanding its global procurement network for raw materials such as coffee, cocoa and edible nuts, which are projected to see a notable increase in global demand in the coming years.
About the MC-Olam Business Agreement: Under the agreement, MC will acquire existing Olam shares from the original promoters representing 8% of the enlarged issued capital of Olam, and acquire another 12% of the enlarged issued capital through the allotment of new shares by Olam for a total of 20%, amounting to a value of approximately S$1.53 billion (approx. 130 billion yen). MC will also appoint up to two executives to serve on Olams board. The partners will be working together to expand their global network for procurement of food products with the aim of responding adequately to growing customer concerns about sustainability, specifically as it relates to a wide range of confectioneries and raw materials.
The venture will allow the partners to pool Olams production and procurement expertise with MCs food manufacturing and sales strengths to develop, on a global basis, a new business platform that ranges from agricultural production, procurement, processing and manufacturing right through to sales. Olam already has a strong raw materials and food processing base in Africa and the partnership will allow MC to expand its presence in a region that carries much future potential as a consumer market.
