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The Competition Commission of India approves the business combination between Bunge Global SA and Viterra Limited under Section 31(1) of the Competition Act, 2002. Bunge acquires one hundred percent of the issued and outstanding share capital of Viterra. Danelo Limited, CPPIB Monroe Canada, Inc., and Venus Investment Limited Partnership receive minority stakes in Bunge as part of the consideration. The review covers horizontal overlaps in crude vegetable oils and non-grain feed ingredients, alongside vertical linkages between upstream crude oil marketing and downstream refined oil production. The Commission determines that the combination does not create an appreciable adverse effect on competition in India due to existing market competitors and low combined market shares.
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COMPETITION COMMISSION OF INDIA
Combination Registration No. C-2024/04/1140
30^th July 2024
Notice under Section 6(2) of the Competition Act, 2002 given jointly by Bunge Global SA, Danelo Limited, CPPIB Monroe Canada, Inc., and Venus Investment Limited Partnership
CORAM:
Ms. Ravneet Kaur
Chairperson
Mr. Anil Agrawal
Member
Ms. Sweta Kakkad
Member
Mr. Deepak Anurag
Member
Order under Section 31(1) of the Competition Act, 2002
On 23^rd April 2024, the Competition Commission of India (Commission) received a Notice under Section 6(2) of the Competition Act, 2002 (Act) jointly given by Bunge Global SA (Acquirer/Bunge), Danelo Limited (Danelo), CPPIB Monroe Canada, Inc. (CPPIB Monroe), and Venus Investment Limited Partnership (Venus). Danelo, CPPIB Monroe and Venus are special purpose vehicles wholly owned by Glencore PLC (Glencore), the Canada Pension Plan Investment Board (CPP Investments), and the British Columbia Investment Management Corporation (BCI), respectively (Glencore, CPP Investments and BCI are collectively referred to as the ‘Sellers’; Danelo, CPPIB Monroe and Venus are collectively referred to as the ‘SPVs’; and Bunge and the SPVs are collectively referred to as the ‘Acquirers’).
The proposed combination relates to acquisition of 100 percent of the issued and outstanding share capital of Viterra Limited (Viterra/Target) by Bunge pursuant to a Business Combination Agreement dated 13^th June 2023 (BCA) executed, by and between the Acquirer, the Target, the SPVs and Viterra Employee Benefit Trust (VEBT) (Proposed Combination) [hereinafter, Bunge and Viterra are collectively referred to as the ‘Parties’]. Further, as a part of the consideration for the Proposed Combination, Danelo, CPPIB Monroe and Venus will receive Bunge stock and as a result, respectively own minority stakes of 15 percent, 12 percent and 3 percent, in Bunge.
In terms of Regulation 14(3) of the Competition Commission of India (Procedure in regard to the transaction of business related to combinations) Regulations, 2011 (Combination Regulations), vide letter dated 9^th May 2024 (RFI), certain information and clarifications were sought from the Acquirer. The Acquirer submitted its response on 27^th June 2024 after seeking extension of time (Response 1). As the Response 1 was found to be incomplete, another letter was issued to the Acquirer, on 11^th July 2024, in continuation of RFI, seeking requisite information and clarifications. The Acquirer submitted its response to the same on 22^nd July 2024, after seeking extension of time (Response 2) [Response 1 and Response 2 collectively constitute ‘Response to RFI’].
Bunge, the Acquirer, is the parent entity of the Bunge group. It is an agribusiness and food company listed on the New York Stock Exchange (NYSE) and headquartered in Chesterfield, Missouri, the United States of America (USA). The significant shareholders^1 of Bunge include Capital World Investors and The Vanguard Group, with respective holdings of 12.6 percent and 11.45 percent of Bunge’s capital stock. Globally, Bunge is mainly active in the sale of oilseed meals and vegetable oils. Bunge also sells grains and milled products as well as unprocessed oilseeds and other products like sugar. In India, Bunge is engaged in sales of refined vegetable oils (groundnut oil, mustard oil, palm oil, rapeseed oil, soybean oil, sunflower oil, sesame oil, oil blends and other oils), crude vegetable oils (soybean oil, palm oil, palm kernel oil, sunflower oil), soybean meal, glycerine, margarine, lecithin, vanaspati, shortenings, yeast and free fatty acids.
^1 That is the beneficial owners of 10 percent or more of Bunge Stock (as of 24^th January 2024).
Viterra, the Target, is an agribusiness company, which is privately held and limited by shares. It is incorporated under the laws of Jersey, UK and headquartered in Rotterdam, the Netherlands. The significant shareholders of Viterra include Glencore and CPP Investments with respective shareholding of 49.99 percent and 39.99 percent while other shareholders include BCI and VEBT. As submitted, globally, Viterra focuses on the purchase and sale of unprocessed commodity crops, in particular grains. Viterra also sells oilseeds and other unprocessed products like cotton and sugar, as well as milled products and oilseed-based products (e.g., meal and oil). In India, Viterra is engaged in sales of grains (wheat, corn, sorghum and rice), crude vegetable oils (soybean oil and sunflower oil), sunflower meal, sugar, cotton, pulses (peas, lentils, raw chickpeas, raw yellow peas, processed chickpeas, processed yellow peas and beans), and chickpea and yellow pea flours apart from having limited presence in origination activities^2.
Danelo, which as stated above, is a wholly owned subsidiary of Glencore, is incorporated under the laws of Jersey and does not have any activities in India or worldwide. Glencore (including its group companies) supplies and trades a wide range of commodities and raw materials, including metals, minerals, oil and oil products and coal to industrial customers around the world and is active in the automotive, steel, power generation, and oil sectors. In India, Glencore is primarily engaged in the sale of energy products, metals, and metal products.
CPPIB Monroe, which as stated above, is a wholly owned subsidiary of CPP Investments, is incorporated under the laws of Canada and does not have any activities in India or worldwide. CPP Investments is a professional investment management organization that invests the funds not utilised by the Canada Pension Plan (CPP) to pay current benefits in the best interest of its contributors and beneficiaries.
Venus, which as stated above, is a subsidiary of BCI, is incorporated under the laws of Canada and does not have any activities in India or worldwide. BCI is a global investment manager that works with public sector clients, such as pension funds and endowment funds, to invest their money in different markets around the world.
^2 As submitted, Viterra procured agricultural commodities such as domestic channa, wheat, maize, lentils and cotton from farmers and farmer producer organizations in India.
Identification of horizontal overlaps/vertical linkages
Bunge and Viterra are both agribusiness companies. As submitted, none of the portfolio entities of CPP Investments, BCI and Glencore are present in any of the agribusinesses in India and accordingly, the horizontal overlaps/vertical linkages for the purpose of competition assessment are identified considering the activities of Bunge and Viterra in India.
Considering the activities of Bunge and Viterra in India, it is observed that within the agribusiness sector, the activities of the Parties primarily overlap only in the segment of vegetable oils. Narrowing down further, the activities of Bunge and Viterra overlap specifically in the segments of soyabean oil and sunflower oil. Further, for identification of any horizontal overlaps/vertical linkages etc., it would also be appropriate to note the key stages of supply chain of vegetable oil. For vegetable oils, the agricultural commodities consist of the following key stages:
