UPDATE: Olam International Still Has US$1 Billion To Spend On Acquisitions
June 08 2010 - 12:58AM
Dow Jones News
Olam International Ltd. (032.SG) Executive Director Shekhar
Anantharaman said Tuesday the group still has about US$1 billion to
spend on acquisitions from funds it has raised over the past
year.
Anantharaman said the group raised about US$1.8 billion through
bonds, bank syndication transactions and an equity placement over
the past 12 months.
The group has spent about US$800 million on acquisitions and
working capital expenses in that time, leaving about US$1 billion
for further purchases.
"This in our view is sufficient to fund our strategic plan going
forward," he said in a teleconference.
However, he said in the near-term the group is unlikely to make
any equity-linked acquisitions.
"We have clearly indicated to the market that we don't intend to
do any equity or equity-linked transactions in the near future," he
said.
"We will never say 'never,' but for the current scope of M&A
deals that we are embarking on, the amount that we have raised
looks to be sufficient."
Olam Tuesday said it has purchased some of the assets of Gilroy
Food & Flavors from U.S.-based ConAgra Foods Inc. (CAG) for
US$250 million.
Anantharaman also confirmed that the group is looking to raise
US$300 million in a three-year term loan.
"The news related to us doing a U.S. syndication is true--we
have launched that transaction in the U.S.," he said.
He said the facility may be increased from US$300 million and
that it was meant to meet the working capital requirements of the
company's U.S. operations.
The transaction was launched last week and that he expects the
deal to "run its course" over the next four weeks, he said.
His comment confirms a Dow Jones Newswires report last week that
the commodities group was looking to raise US$300 million.
People familiar with the transaction had said last week that the
term loan is expected to pay 275 basis points over the London
Interbank Offered Rate, or Libor.
Olam has hired Credit Suisse, JP Morgan, HSBC, Standard
Chartered Bank and Fortis for the term loan.
-By Sam Holmes, Dow Jones Newswires; +65-6415-4157;
samuel.holmes@dowjones.com
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