Cargill is close to snapping up ADM Cocoa, according to reports, but both companies remain tightlipped.
News agency Reuters claims the two industry giants are close to agreeing a deal for around $2bn, citing sources familiar with the situation.
ADM refused to comment, while Cargill said that it “will communicate as and when there is anything definitive”.
Cargill was pushed off the top spot as the world’s largest cocoa grinder when Barry Callebaut finalized a $950m deal for Singapore-based Petra Foods’ ingredients division this summer. Any deal for ADM Cocoa would see Cargill reclaim pole position.
ADM put its cocoa division up for sale in June this year after the business unit saw profits plunge 24% in 2012 to $183m.
The segment accounted for 7% of the company total $2.5 bn operating profit for the year.
ADM Cocoa has an annually grinding capacity of around 600,000 metric tons (MT) and accounts for 15% of global cocoa processing – third behind Barry Callebaut and Cargill.
Laurent Pipitone, director of the economics and statistics division at the International Cocoa Organization (ICCO) previously told ConfectioneryNews that Cargill was not a likely suitor, but if it were to buy ADM Cocoa and axe some processing operations, a small reduction would not affect the supply demand balance for cocoa.