Marubeni gets $3 billion from sale of Gavilon grain business

TOKYO, Oct 4 (Reuters) – Japanese trading company Marubeni Corp (8002.T) said on Tuesday it had so far sold the grain business of U.S. unit Gavilon to commodities trader Glencore (GLEN.L)’s Viterra unit received $3 billion.

Marubeni had received $3 billion by October, according to a deal announced in January and closed on Monday. 3, Including group financing from Marubeni to Gavilon, based on best estimate at more

Marubeni said in a statement that the sale price will be determined based on factors such as net trade working capital and net debt by the deadline agreed with Viterra.

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In January, Marubeni said it expected to receive a total of 300 billion yen to 400 billion yen ($2.1 billion to $2.8 billion) from the deal.

Marubeni expects to gain about 55 billion yen ($379.7 million) from the sale in the October-December quarter.

The company said it is evaluating the impact of the gain on its earnings forecast for the fiscal year ended March 31, and plans to provide an update on November 3. Earnings results for the April and July-September quarters.

For Marubeni, the sale marks the end of a painful journey of 120 billion yen in impairment losses since its $2.7 billion acquisition of Gavilon in 2013 amid weak grain prices and market volatility.

But the deal is estimated to have contributed positively to Marubeni, given the money it received from the sale and the profits it accrued from Gavilon’s business, including the fertilizer unit that the Japanese trading company retained, a Marubeni spokesman said.

(1 USD = 144.8700 yen)

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Reporting by Yuka Obayashi; Editing by Subhranshu Sahu

Our Standard: The Thomson Reuters Trust Principles.

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