After having recently bought two Romanian edible oil makers, the Americans at Bunge Ltd., one of the world’s leading companies in the foodstuffs industry, are now contemplating new opportunities to expand in agriculture.
“We will not make any new acquisitions on the edible oil market, at least not until the end of this year. The logical thing for us to do now is invest in the agroindustrial sector,” Bunge Romania general manager Robert Arsene said.
“We are considering various options, but Romania is not the only country that has potential,” he added.
The company will invest $5 to $7 million in the next three years in order to bring the Romanian companies (Muntenia Bucharest and InterOil Oradea) it has recently included in its portfolio back on track.
“Things have started to roll. We are organising activities at a national level, we have an investment and human resources programme,” Arsene said.
Arrived on the Romanian market in late last year, following an international deal by which it took over the majority sharheolder of Unirea Iasi, Netherlands-based Cereol BV, Bunge has recently bought the two domestic companies through tender offers.
All in all, Bunge paid about $5.4 million for Muntenia and InterOil. The main seller in the case of both companies was Prefabricate Vest, the majority shareholder of the two entities.
Bunge paid $2.4 million for InterOil, its latest acquisition and $3 million for Muntenia.
Back when Bunge took over those companies, the analysts and the representatives of the edible oil industry commented it had paid too high a price for them, considering both companies were in a rather bad shape, due to the lack of investments from the former shareholder, which had caused production breaks repeatedly.
“The two companies have always lacked cash, but their operations will be reorganised, we will introduce state-of-the-art systems for them to do their job and we have an integration plan for both of them. We are currently working with consultant Roland Berger in this regard,” Arsene said.
He added the two facilities would work for Bunge and use a national distribution system.
Muntenia’s portfolio includes the Muntenia brand, which is very popular in southern Romania mainly and accounts for 3% of the market, while InterOil’s includes Horea, yet another local brand.
“The moment an acquisition decision is made, the buyers consider several prospects and Bunge had analysed the takeover of the two companies for about a year,” Arsene said.
Inquired why Bunge had not chosen famous companies that also had a higher productive capacity, Arsene said “companies that are famous and have better logistics are not as many to find and those that are good are not for sale.”
This year’s plans of the company do not include launching new edible oil brands, as it will keep investing in the old ones. claudia.covaci@zf.ro