The Canadian government has given approval to Glencore International pic to proceed with its $6.1 billion purchase of Calgary-based agribusiness firm Viterra Inc. The approval came from the Honorable Christian Paradis, Minister of Industry. In a release, Paradis said: "I have approved Glencore's application under the Investment Canada Act to acquire control of Viterra. In making my determination, I carefully consider the plans, undertakings and other information submitted by the investor in light of the net benefit factors listed in section 20 of the Act. Glencore has made a number of commitments to Canada. These are described in its press release issued on July 15, 2010."
Viterra acknowledged the approval and said Glencore has also received notification from the appropriate regulator in China that it has moved into "the next phase of review of the transaction." The two firms are also awaiting approval from regulators in New Zealand and Australia.
Some of the commitments made by Glencore include: increasing Viterra's projected expenditures in Canada by more than C$100 million over five years; investing C$8 million above Viterra's projected expenditures in R&D and increasing contributions toward programs supporting the Western Canadian farm community by 25%.
The Swiss-based Glencore is an integrated producer and marketing of commodities. Viterra provides premium-quality ingredients to leading global food manufacturers, according to press statements.
Glencore press release:
Viterra press release: