TrailStone's bid for Cargill's power, gas book falls through: sources

NEW YORK/HOUSTON (Reuters) - Commodities trader and investor TrailStone Group’s bid to buy Cargill Inc’s U.S. power and gas trading book has fallen through, two sources familiar with the matter said on Tuesday, setting back the seller’s efforts to streamline operations.

The sources, who requested anonymity because they are not authorized to speak to the media, said it was not clear why the deal was off.

A TrailStone representative declined to comment. Cargill spokeswoman Anna Lovely said in an email that the company continues to operate its North American power and gas business, but declined to comment on the report.

In January, sources had said that Cargill was planning to sell its gas and power business to TrailStone, which is funded by Riverstone private equity group.

Cargill has spent the past year streamlining its businesses as global oil prices have slumped for nearly three years. In March, Australian investment bank Macquarie Group Ltd agreed to buy Cargill’s petroleum business.

The power and gas industry is reshuffling as private equity firms and hedge funds enter the business, filling a void left by banks and other longtime players.

Last year, TrailStone, run by former executives from Deutsche Bank’s commodities group, agreed to buy a stake in a small U.S. power retailer to expand in the North American energy market.

Reporting by Catherine Ngai in New York and Liz Hampton in Houston; Editing by Chizu Nomiyama and Richard Chang