Archer Daniels in talks to sell cocoa business
THE ASSOCIATED PRESS June 21, 2013 12:44PM
Updated: June 21, 2013 12:44PM
DECATUR — Archer Daniels Midland Co. says it is in talks to sell its cocoa business, which sent its shares up in trading Friday.
The agribusiness giant, based in Decatur, Ill., converts oilseeds, corn, wheat and cocoa into products for food, animal feed, industrial and energy uses.
Archer Daniels Midland’s cocoa business has proven less profitable recently due to weaker cocoa margins. Its cocoa segment delivered an operating profit of $183 million in 2012, down from $240 million in 2011.
The Financial Times reported the value of the company’s cocoa business at $2 billion, citing industry executives.
Company spokeswoman Jackie Anderson said in a statement Thursday that the company is currently engaged in discussions about the potential sale of the cocoa business but did not disclose with whom it is talking. Anderson said the talks are ongoing and that the company will communicate further if appropriate.
Archer Daniels is trying to buy the stake of Australian gran handler GrainCorp Ltd. that it doesn’t already own. It is offering 12.20 Australian dollars ($12.63) per share in cash for the stake, giving all of GrainCorp a value of 3.4 billion Australian dollars. Its two previous offers for GrainCorp were rejected as too low.
Shares of the company jumped 55 cents, or 1.7 percent, to $33.16 by midday Friday amid a broader market decline.