HOUSTON (ICIS)--Switzerland's Cargill and Brazil's Copersucar announced Thursday an agreement to combine their global sugar trading activities into a new joint venture that will originate, commercialise and trade raw and white sugar.
Both Copersucar and Cargill will own a 50% stake in the new venture, which aims to serve customers better by connecting the two companies' experience and strengths in quality and logistics within the sugar supply chain, the companies said.
The new company will be an independent operation with a new name to be announced at closing. The trading activities will be based out of Geneva, Switzerland.
Both companies’ ethanol businesses and fixed assets, such as terminals and mills, are excluded from the transaction, and while the formation of the joint venture is dependent upon regulatory approval, it is expected to be finalised in the second half of 2014.
Officials from both sides were enthusiastic about the partnership and its enhanced abilities to move a wide range of sugar qualities and different origins from port to destination in a timely and efficient manner, meeting the specific requirements of customers worldwide.
Copersucar additionally brings a large-scale supply from partner mills in Brazil which is complemented by Thai, Indian, Central American and Australian origins. Additionally, it will benefit from the companies’ logistics management and access to the elevation terminals in Brazil.
“Through the new company, Copersucar reinforces its strategy of achieving a global footprint in the sugar market. Copersucar also enhances its unique business model, based on large-scale supply, logistic capacity and the integration of all links of the chain, from the producers to the customers,” said Luis Roberto Pogetti, Copersucar chairman.
For its part, Cargill said that it shares with Copersucar the same business values and commitment to high ethical business standards and to being a responsible partner in the communities in which they operate.
“We believe that the strong analytical capabilities of our trading teams, combined with the global footprint of this new joint venture, will offer our customers a distinct understanding of the global market,” said Olivier Kerr, Cargill corporate vice president.
As far as management roles for the joint venture, the companies announced that Ivo Sarjanovic, who currently leads Cargill’s sugar business, will be appointed CEO once the new company is formed.
Soren Hoed Jensen, current sugar and ethanol sales executive director of Copersucar, will become the joint venture’s chief operating officer, and Stefano Tonti, currently financial controller of Cargill’s global trading and sugar businesses, will become the new joint venture’s chief financial officer. Luis Roberto Pogetti, chairman of Copersucar, will become the first rotating chairman.