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CEO of Viterra, Mayo Schmidt. (Troy Fleece/Troy Fleece/for The Globe and Mail)
CEO of Viterra, Mayo Schmidt. (Troy Fleece/Troy Fleece/for The Globe and Mail)

Glencore signals it would sell Viterra's retail assets Add to ...

Glencore International Plc would sell Viterra Ltd.'s retail farm supply operations if it bought the Canadian grainhandling company, according to two people briefed on Glencore Chief Executive Officer Ivan Glasenberg's thinking about Viterra.

Viterra said last week that it had received expressions of interest from other companies, and Glencore is believed to be one of those circling. The Sunday Telegraph reported that Glencore offered about $5.5-billion (U.S.) for Viterra. The Switzerland-based commodities trading company has not officially confirmed its interest.

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Were Glencore to bid, it would look to divest Viterra's chain of retail stores as well as Viterra's share in a fertilizer manufacturing business, said the people, who declined to be identified because Glencore has not made the information public.

Viterra sells seed, fertilizer, pesticide and equipment through a network of almost 260 locations in Canada, and another 17 in Australia, according to the latest Viterra annual information form. The company also co-owns a fertilizer plant in Medicine Hat, Alberta, with CF Industries, which might be interested in picking up full ownership of the factory.

A likely buyer for the retail network would be Agrium Inc. . Agrium has a big business selling products to farmers, with its own retail network stretching across North America. A partnership with Agrium would also allow Glencore to “Canadianize” a bid for Viterra, which might ease the way to getting Canadian government approval for a takeover.

A London-based spokeswoman for Glencore declined to comment.

The retail network and fertilizer plant had total sales last year of $2.4-billion, according to Viterra filings.

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