ROTTERDAM, THE NETHERLANDS, 16 January 2019 – Louis Dreyfus Company B.V. (LDC) today announced its decision to exit its Dairy business by mid-2019.
The move is in line with the company’s strategy over the past three years to exit non-core areas and refocus on its core businesses, including investments in origination markets and expansion along the value chain in its key product lines.
“LDC’s Dairy Platform was identified as non-core in 2017 due to its lack of critical mass within the company’s portfolio,” said Federico Cerisoli, Chief Financial Officer. “The business accounted for roughly 1% of our revenues in 2018 and demanded substantial working capital resources. LDC has been evaluating the best way to exit the business, either through an orderly wind down or a sale to potential buyers – these efforts are continuing and an exit will be implemented by the middle of this year. The exit will have practically no impact on our global sales, which continue to grow overall, and is expected to have a slight positive effect on our working capital from 2019 onwards,” Mr. Cerisoli added.
“We worked hard to separate the business from the rest of LDC’s portfolio and will be working equally hard with our customers and suppliers over the coming months to ensure a smooth exit by mid-2019,” said Jean-Marc Foucher, Head of LDC’s Dairy Platform. “Following the exit, LDC’s only exposure to dairy will be a non-controlling stake in a dairy processing plant in Australia, operated by a joint venture partner,” he concluded.
LDC has been in the Dairy business since 2009, originating from key suppliers in North America, Europe, Oceania and South America. It delivers mainly milk powders, lactose and whey products to key demand markets, including Asia, Mexico, North America, the Middle East and Africa.
As part of its strategy to exit non-core areas, LDC has divested both its Fertilizers & Inputs and its Metals platforms in the past 18 months. This leaves the company well positioned to grow in its core business areas.
LDC is pursuing ambitious growth plans for the future. These include continued investments in origination and destination markets, further vertical and horizontal development downstream toward the end consumer, and expansion in food innovation, with the aim of sustainably meeting the needs of a growing population.
About Louis Dreyfus Company
Louis Dreyfus Company is a leading merchant and processor of agricultural goods. We leverage our global reach and extensive asset network to serve our customers around the world, delivering the right products to the right location, at the right time – safely, responsibly and reliably. Our activities span the entire value chain from farm to fork, across a broad range of business lines (platforms). Since 1851 our portfolio has grown to include Oilseeds, Grains, Freight, Global Markets, Coffee, Cotton, Sugar, Rice, Dairy and Juice. We help feed and clothe some 500 million people every year by originating, processing and transporting approximately 81 million tons of products. Structured as a matrix organization of 6 geographical regions and 10 platforms, Louis Dreyfus Company is active in over 100 countries and employs approximately 17 000 people globally. For more information, visit www.ldc.com and follow us on Twitter and LinkedIn.
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