Canada’s biggest grain handler has sold its stake in a group of grain handling sites in two Australian states to the facilities’ other owner.
Viterra said Tuesday it will sell the 50 per cent share in the Australian Bulk Alliance (ABA) joint venture it acquired last September when it bought ABB Grain. The buyer, Japanese trading house Sumitomo, bought the other 50 per cent from GrainCorp Ltd. in 2004.
Sumitomo-owned Summit Grain Investment (Australia), will exercise the company’s option to buy Viterra’s shares in ABA for A$8.6 million (about C$8.01 million). The deal, expected to close April 21, will make ABA a wholly-owned Sumitomo subsidiary.
ABA’s grain storage network includes eight country sites in the southeastern states of Victoria and New South Wales, plus a grain terminal, co-owned with AWB Ltd., at the Port of Melbourne.
ABA’s country sites at The Rock, Coolamon, Tocumwal, Nullawil, Nhill, Woorinen, Goolgowi and Tatyoon Nort have a total storage capacity of over 800,000 tonnes. The ABA business was formed by Grainco Australia and AusBulk in 1999 and passed through to its current owners through various mergers and sales.
Rob Gordon, Viterra’s vice-president for South East Asia, said the Regina-based grain firm’s focus is on its “strategic assets” such as its own network of storage and handling facilities, but it will still provide service in the Victorian market.
That includes the company’s presence at the Port of Geelong, about 60 km southwest of Melbourne.
Also, he said, “with our recent investment in the Panamax-capable port at Outer Harbor (about 740 km northwest of Melbourne, in South Australia) we will be able to draw grain from western Victoria, offering export opportunities for those growers.”
Gordon said the merged Viterra and ABB Grain plan to “increase our product offerings in Victoria and throughout Australia, and we are developing new marketing opportunities which capitalize on our international competitive position.”
ABB in recent years had hired “specialist grain accumulation managers and wool agents” in the Victoria market, and already had fertilizer, container packing and storage and handling operations there, Gordon noted.