Louis Dreyfus breaks 169- year history by selling large stake to Abu Dhabi-based ADQ

NETHERLANDS — Louis Dreyfus Company (LDC), one of the world’s largest grain traders and processors of agricultural products has agreed to sell a large stake in the company to Abu Dhabi-based holding company ADQ.

According to a statement from LDC, the main Louis Dreyfus Company Holdings BV (LDCH) business will sell a 45% equity stake to ADQ.

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The sale marks the first time in the private company’s 169-year history that it will operate with ownership outside the family.

“The transaction announced today constitutes a milestone in a decade-long strategy envisioned by the supervisory board, which started with the consolidation of LDC’s parent company’s shareholding,” said Margarita Louis-Dreyfus, chairperson of the supervisory board of LDCH.

“We are delighted to welcome ADQ to our shareholder group as long-term partners and investors, with a common vision for LDC’s future, and experience that will bring further value to the business and support the Group’s ambitions.”

Although the value of the transaction remains uknown, available information from LDC revealed that a minimum of US$800 million will be invested into LDC.

ADQ’s broad portfolio of major enterprises spans multiple sectors, among them food and agriculture.

As part of its strategy for the sector, the company seeks to generate financial returns and strengthen the economic cluster in the UAE.

“As one of the world’s leading agri-commodities and food companies, LDC represents a strategic investment opportunity for ADQ, in line with our long-term food and agriculture investment strategy,” said H.E. Mohamed Hassan Alsuwaidi, CEO of ADQ.

According to a statement from ADQ, the agreement with Louis Dreyfus will see ADQ have an opportunity to sell agricultural commodities to the United Arab Emirates.

LDC posted strong earnings results in the first half of 2020 as it navigated global challenges such as the coronavirus (COVID-19) pandemic, trade tensions and market uncertainty.

Overall, LDC’s net income during the six-month period ended June 30 was US$126 million, up from $71 million in 2019.

Sales amounted to $16.3 billion, down slightly from $17.5 billion partly to lower-than-average prices of main commodities traded by the company and a 2.9% slip in volumes shipped.

Louis Dreyfus is one of the so-called “ABCD” quartet of the world’s leading commodity trading houses, along with US-based Archer Daniels Midland Co., Bunge Ltd and Cargill.

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