ADM cuts stake in Wilmar, sells shares worth $550m

ADM has completed its secondary block trade of shares in its Singapore-based agribusiness joint-venture, Wilmar, for approximately $550 million.

Following the transaction, ADM will retain at least a 20% strategic ownership stake in the company. In 2018, ADM chairman and CEO Juan Luciano told investors that ADM’s stake in Wilmar had surpassed the 25% mark which was a milestone in the company’s growth journey.

ADM expects to use the net proceeds from the deal to fund its capital expenditures, possible acquisitions and a possible buyback.

Since 1994, ADM has been a significant investor in Wilmar and the agribusiness is now one of ADM’s largest customers, with claims that it is a key component in its strategy in emerging markets such as Asia Pacific.

ADM first partnered with the agribusiness and packaged food oils company in the early 1990’s when they jointly built a network of soybean processing operations in China. Wilmar is now an important trade partner of ADM and co-owner of joint venture Olenex, a major European provider of speciality oils.

“We are exceptionally pleased with our longstanding relationship with Wilmar,” said ADM chairman and CEO Juan Luciano.

He added: “This transaction provides ADM with additional capital while retaining that strong relationship. We have no plans to sell additional Wilmar shares, and look forward to continuing our partnership for years to come.”

On 26 August, ADM completed the issuance of $300 million worth of zero coup bonds outside the US, bringing the total amount of capital raised to approximately $850 million.