U.S.-based Seaboard announced earlier this month that it has finalized the deal, which will increase the flour and feed milling capacity of its consolidated and non-consolidated businesses by approximately 15%, to more than 22,000 tonnes per day, and its grain trading volume by approximately 9%, to about 10.5 million tonnes per year.
With the acquisition, Seaboard now operates grain-related businesses in 41 locations in 22 countries in Africa, South America and the Caribbean, including 18 that involve wheat flour milling.
“We are excited to further our investment in sub-Saharan Africa with this acquisition and believe the culture and operations will be a great fit with our existing structure,” said Steven Bresky, president and chief executive officer of Seaboard. “Seaboard has had commercial ties with the Mimran Group for almost 40 years and we look forward to integrating the business into our existing trade strategy and expand our cargo and trade opportunities as a result of this transaction. We expect to continue to work closely together with Mimran Group by leveraging our existing strengths into a better industrial and trade-based business.”
Dave Dannov, president of Seaboard’s overseas trading group, told World Grain the company is acquiring Groupe Mimran’s flour mill and feed mill in Dakar, Senegal; a flour mill in Abidjan, Ivory Coast; a flour mill in San Pedro, Ivory Coast; and its grain trading business based in Monaco.
“We view the addition of their grain trading business positively as well as it allows us to further expand our third-party grain trading base that supports our integrated trading to our own affiliates,” Dannov said. “We expect we will be able to expand the grain trading business, which is something they never really focused on as much as we will.”
Dannov said the company plans to expand grain storage capacity at the mills in Abidjan and Dakar as well as “replicating what we’ve done elsewhere in vertical integration opportunities in industries such as pasta and poultry.”
He said the milling facilities acquired in the transaction are located near ports that fit nicely into Seaboard’s transportation strategy.
“With this acquisition, we will increase our presence in the West African grain trading arena,” he said. “Through our owned and chartered vessels, we will be able to service our own mills and third-party mills with greater frequency and additional flexibility. Adding such large volumes of wheat in Dakar, Abidjan and San Pedro will help to enhance services we currently provide.”
Seaboard’s first investment in Africa was in 1967, so the company is well aware of the risks as well as the opportunities and risks on the heavily populated continent, which includes many developing countries, Dannov said.
“By having that understanding it makes it easier to weather the ups and downs that come with doing business there,” he said “You have to be patient, well capitalized and understand that any one year could be dramatically different from another year because of political events, market conditions, or currency issues. By further expanding in Africa, we’re actually reducing our overall risks through diversification across the continent. And we’re integrating the supply chain where we’re buying wheat from the lowest-cost origination point, taking into account quality parameters, shipping it on our own ships, and then processing it.”
Groupe Mimran has been one of the leading agri-food groups in West Africa, operating sugar refining, flour milling and animal feed businesses. It was founded more than 60 years ago by the Mimran family, and its main companies in flour milling and sugar refining include Grands Moulins de Dakar, Grands Moulins d’Abidjan, and Compagnie Sucriere Senegalaise.
At the time that the companies signed a memorandum of understanding regarding the acquisition, in September, David Mimran, president and director general of Grand Moulin d’Abidjan and Grands Moulins de Dakar, said the decision to sell the company was made easier because Seaboard “shares the same values and culture that we have instilled within our business over the years.”
“Just like ourselves, Steve Bresky is the third generation of his family running a substantial business, and I very much look forward to assisting Mr. Bresky and his team in any way we can with respect to this new chapter in the development of the business,” David Mimran said.
The flour milling capacity at the Abdijan mill is 1,200 tonnes per 24 hours and includes a 600-tpd milling line featuring Ocrim equipment and another 600-tpd milling line featuring Golfetto equipment. San Pedro’s 24-hour milling capacity is 250 tonnes using Ocrim equipment. The flour mill in Dakar has 24-hour milling capacity of 1,300 tonnes, a 500-tpd Ocrim milling unit and two 400-tpd Golfetto milling units. The feed mill in Dakar has a processing capacity of 1,000 tonnes per 24 hours.
Founded nearly 100 years ago, Seaboard operates globally through a network of integrated industrial service oriented companies with sales of more than $5 billion per year. The company’s main activities include processing and production of pork and turkey products, containerized shipping, and international grain processing and trading.