11:01 13.01.2014

Cargill buys 5% of Ukrlandfarming for $200 mln - media

2 min read

The world's largest raw materials trader, Cargill, has acquired a 5% stake in Ukrlandfarming, Ukraine's largest agricultural holding in terms of land bank, for $200 million, the Financial Times edition has written.

"The acquisition of 5% of Ukrlandfarming intensifies Cargill's presence on the agricultural market, one of the most promising in the world," reads the report.

Given the amount of the transaction, the newspaper reads, the total cost of Ukrlandfarming's land bank, the eighth largest land bank in the world, was estimated at $4 billion.

According to Financial Times, Cargill confirmed its five-percent stake in the holding, while noting that it has no intention to manage the business of the latter.

According to the publication, it is expected that the deal will allow Ukrlandfarming to expand grain exports, in particular, to Asia. In the 2013/2014 marketing year (MY, July - June) the agroholding plans to export up to 700 million tonnes of corn to China. Within five years, according to holding owner Oleh Bakhmatiuk, the total export figure should reach 6 million tonnes per MY, one-third of which will account for the Asian market.

The edition noted that China more often refuses imports of GM maize from the United States in favor of organic products from Ukraine. First deliveries of corn from Ukraine to China were made late last year under the loan agreement of $3 billion.

Ukrlandfarming confirmed the transaction was closed at the end of 2013.