May 3, 2019 / 1:52 PM / 3 months ago

Louis Dreyfus could consider selling stake to regional player

PARIS (Reuters) - Louis Dreyfus Company, one of the world’s biggest agricultural commodities houses, may consider selling a stake to a regional player to support its development although there are no specific plans to do so, the company said on Friday.

Agricultural commodities traders have been grappling with lower profits from sourcing and shipping commodities such as grain and oilseeds, prompting cutbacks in trading teams, investments in food processing activities and acquisition speculation.

Bloomberg reported on Friday that Louis Dreyfus (LDC) was in talks with investors about selling equity stakes in the company, potentially opening up the family-controlled business to outside capital for the first time in its 168-year history.

“(Chief Executive Ian McIntosh) confirmed that all options remain open, including the possibility of opening LDC’s capital to regional players who could help drive our development,” LDC spokeswoman Karen Saddler said in an emailed statement to Reuters.

“There are no specific plans, but all possibilities are open,” she added.

One source familiar with the matter said separately that the group was looking for a minority partner to get access to cash and a network.

Louis Dreyfus said last month that it planned to invest in the stock market flotation of Asian poultry and food company Leong Hup International, as it looks to increase its presence in food processing and cited regional partnerships as a way to expand.

The company also bought a stake in Luckin Coffee Inc as part of a U.S. initial public offering planned by the Chinese chain last month.

Bloomberg said LDC had approached Chinese partners, such as COFCO Corp, and its global trading arm COFCO International Ltd, as well as some of Japan’s biggest trading houses.

LDC said McIntosh meets a broad variety of stakeholders, including peers like COFCO, which was not to say that he is looking to find a partner or discuss this with all those he meets.

Reporting by Gus Trompiz in Paris and Rama Venkat in Bengaluru, additional reporting by Oliver Hirt in Zurich, writing by Sybille de La Hamaide, editing by Susan Fenton

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