Monday October 20, 2014




Home »  News »  Agriculture

China's approval still needed on Gavilon takeover

Marubeni expects approval for $5.6B deal by end of March

Japanese trading house Marubeni Corp. said it expects to get Chinese regulatory approval for its long-delayed US$5.6 billion purchase of U.S. grain merchant Gavilon by the end of March.

The transaction, which has received clearance from U.S. and European anti-competition authorities, needs Chinese approval because Marubeni will increase supplies of grains to the world's most populous country through the purchase.

"As of today, there have been several inquiries from the Chinese authorities and we are providing responses," Marubeni's chief financial officer Yukihiko Matsumura said Friday at an earnings briefing.

"I hope that the approval will be given in the not-so-distant future."

The Gavilon deal, which includes debt of around US$2 billion, would catapult Marubeni, Japan's fifth-biggest trading house, into the top ranks of global grain merchants and put it in a prime position to meet rising demand for grains from China.

The deal had been originally scheduled to close in September but was then pushed back to around the end of November/early December before suffering more delays due to regulatory reviews.

Teruo Asada, president of Marubeni, in November denied media speculation that tension between Japan and China over disputed islands in the East China Sea had delayed Chinese approval.

Marubeni expects to meet its forecast for net profit of 200 billion yen (US$2.2 billion) for the year to March 31.

Net profit for the nine months through December climbed 7.9 per cent to 152.5 billion yen, helped by increased equity in earnings of affiliates in its copper business in Chile, gains in investment securities and favourable foreign exchange rates.

Total trading transactions volume for the nine-month period edged up 0.6 per cent to 7.7 trillion yen on increases in transactions for grains, oil and liquefied natural gas.

-- Osamu Tsukimori is a Reuters correspondent in Tokyo.


Comments


NOTE: To post a comment in the new commenting system you must have an account with at least one of the following services: Disqus, Facebook, Twitter, Yahoo, OpenID. You may then login using your account credentials for that service. If you do not already have an account you may register a new profile with Disqus by first clicking the "Post as" button and then the link: "Don't have one? Register a new profile".

The Yorkton This Week welcomes your opinions and comments. We do not allow personal attacks, offensive language or unsubstantiated allegations. We reserve the right to edit comments for length, style, legality and taste and reproduce them in print, electronic or otherwise. For further information, please contact the editor or publisher, or see our Terms and Conditions.

blog comments powered by Disqus


Quick Vote

Survey results are meant for general information only, and are not based on recognised statistical methods.


Markets





LOG IN



Lost your password?