Summa Group, Russia’s biggest port operator, is raising money for a foreign grain trading acquisition and was considering an offer for GrainCorp Ltd. before Archer-Daniels-Midland Co. made a $2.8 billion takeover bid, according to two people with knowledge of the matter.
The Moscow-based company is seeking to expand its presence in Asia and around the world, and hasn’t ruled out a counterbid for GrainCorp, according to a third person, who asked not to be identified before plans are decided.
Summa submitted a formal request to VEB, the Russian development bank where Prime Minister Dmitry Medvedev is supervisory board chairman, to fund a possible acquisition of GrainCorp, said the two people, who declined to be identified because information is private.
ADM, the world’s biggest corn processor, offered A$2.68 billion ($2.8 billion) for the Australian trader, GrainCorp said on Oct. 22, after raising its stake to 14.9 percent earlier this month.
Russia is targeting Asian customers for its agricultural output as expanding economies to the east outpace growth in Europe. Summa, which last month acquired 50 percent minus one share in United Grain Co. from the Russian government, and VEB plan to build an 8 billion-ruble ($255 million) terminal in the Far East for sales to Asia.
“We are looking outside because Russia doesn’t have a global player in soft commodities markets,” Summa Chairman Ziyavudin Magomedov told Rossiya 24 state television Sept. 4. “We have Glencore, Dreyfus, Cargill here, and Russia, which possesses such a powerful resource, doesn’t have its own worthy global player.”
GrainCorp is the only major publicly traded grain merchant left in Australia after the nation deregulated its wheat export system. It controls seven of the eight ports that ship grain in bulk from the east coast of the country, the world’s second- largest wheat exporter last season. Summa hasn’t decided on a bid for GrainCorp and is looking at many possible deals, one of the people said.
Angus Trigg, a spokesman for GrainCorp, couldn’t be reached for comment when Bloomberg called his office phone after normal business hours in Australia. Summa’s spokesman Dmitry Minenko declined to comment, as did VEB’s press service in Moscow.