Cargill Inc., the giant U.S. agricultural commodity producer and trader, reached an agreement to sell its Argentine flour-milling unit to Molinos Canuelas Sacifia, three people familiar with the deal said.
Canuelas has 60 days to complete the deal, said the people, who asked not to be named as the acquisition talks are private. The purchase will make the Argentine company the country’s largest flour miller with 25 percent of a market estimated at 5 million metric tons a year. Canuelas currently has 16 percent of the market.
Bunge SA, a rival U.S. trader and processor, was an unsuccessful bidder for the Cargill unit, two of the people said. Canuelas’s owner Aldo Navilli and spokesmen for Bunge and Cargill couldn’t immediately be reached for comment.
Minneapolis-based Cargill, the largest closely held U.S. company, has been reorganizing and restructuring over the past year. So far in 2016, Cargill has also agreed to sell its industrial-chocolate business and its dressings and mayonnaise unit, according to data compiled by Bloomberg.
The Argentine flour unit comprises seven milling plants. Cargill remains the country’s second-biggest soybean processor, after Bunge, with an annual capacity of 9 million tons out of a total Argentine capacity of 60 million tons.
Canuelas, based in the town of the same name in the province of Buenos Aires, got an $80 million loan in April from International Finance Corp., an arm of the World Bank. Earlier this year, Canuelas shipped a wheat cargo to the U.S.
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