Bunge drains oil – Business – Kommersant

One of the world’s largest traders in agricultural raw materials – the American Bunge has found a buyer for the last asset in Russia. The company has agreed to sell an oil plant in the Voronezh region to Karen Vanetsyan, the main owner of ExOil Group. Among the co-owners of the holding’s enterprises is the former Russian ambassador to Ukraine and ex-Minister of Health Mikhail Zurabov. The deal could allow the buyer to reduce dependence on the export market.

The American Bunge has agreed to sell its Russian oilseeds processing business, including a plant in the Voronezh region, to Karen Vanetsyan, the main owner of the ExOil Group holding. About this Bunge reported on Monday, 19 September. Closing the deal is conditional and subject to regulatory approval, Bunge said. ExOil Group did not provide an operational comment.

Bunge, along with Cargill, ADM and Louis Dreyfus, is one of the world’s four largest agricultural commodity traders known as ABCD. It has been operating in Russia since 2004, managed by Bunge CIS LLC. The oil extraction plant in the Voronezh region was launched in 2008. Investments in the project were estimated at $130 million. The plant’s capacity is 540,000 tons of raw materials, which makes it possible to produce over 200 million bottles of sunflower oil per year. The brand portfolio includes the Oleina and Ideal brands. In 2020, Bunge CIS occupied 10.3% of the Russian bottled sunflower oil market, according to the company’s website.

ExOil Group is engaged in processing and trading of oilseeds and grains, port transshipment and logistics. It includes an oil plant in the Lipetsk region with a capacity of more than 900 tons of oil per day. According to the Unified State Register of Legal Entities, Mikhail Zurabov, the former head of the Ministry of Health of the Russian Federation and the ex-ambassador of the Russian Federation to Ukraine, owns 25% each of Chernozemye LLC and Chernozemye Trading House LLC.

Greg Heckman, CEO of Bunge, quoted in the Bunge report, noted that Karen Vanetsyan has more than 25 years of experience in the processing of agricultural products, thanks to which the Bunge CIS team will be able to continue to successfully serve customers. Karen Vanetsyan, in particular, owned assets in Ukraine. In 2012, he and his partners sold the Peresechansky oil extraction plant in the Kharkiv region to Swiss Glencore.

Other players also showed interest in the Russian business of Bunge, sources told Kommersant in the industry. Director General of the Institute for Agricultural Market Studies Dmitry Rylko notes that the asset is distinguished by a good condition, optimal location and a portfolio of relatively well-known brands.

According to a Kommersant source in the industry, ExOil Group was mainly engaged in the export of oil and could be one of the most affected companies from the introduction of restrictions on the export of this product. And the purchase of Bunge CIS allows entering the local bottled oil market, Mr. Rylko points out.

The oilseed processing business is Bunge’s latest asset in Russia. Formerly American company sold Rostov grain terminal with a capacity of 700 thousand tons per year to the structure of the former top managers of the United Grain Company Marat Shaidaev and Alexei Chemerichko, who are developing their grain trading business.

Anatoly Kostyrev