ADM to retain cocoa press operations, divest chocolate business

Archer Daniels Midland (ADM) has announced that it will retain the majority of its cocoa press operations but will pursue the sale of its chocolate business.

The company has approached several advisors to assist on the proposed sale process.

ADM had extensive negotiations with a potential buyer over the sale of its global cocoa and chocolate unit; however, the talks were unsuccessful.

ADM chairman and CEO Patricia A Woertz said, "Given improved underlying conditions and the success of our efforts to reduce capital intensity, we see a promising outlook for the cocoa press business and believe it will meet our returns objectives."

The ADM Chocolate unit offers fine chocolates, including dark, milk and white chocolates in Belgium, Germany, the UK, Canada and the US.

The unit operates manufacturing facilities in Pennsylvania, Wisconsin, Ontario, the UK, Belgium and Germany.

Last year, Cargill was understood to be in final-stage talks with ADM to take over the cocoa unit, which experts valued at $2bn.

Separately, ADM has said that it will buy the remaining 20% stake in Alfred C Toepfer International, a German grain trader, for €83m.

The proposed deal is occurring through an agreement with Union InVivo, which has been holding the minority stake since 2010. Following the transaction, InVivo will be a strategic business partner for ADM’s European operations.

Woertz added, "For years, ADM has benefitted from our investment in Toepfer. Now, full ownership will allow us to strengthen this business and fully integrate it into ADM’s global origination network."

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Image: ADM corporate office in Decatur, Illinois. Photo courtesy of Archer Daniels Midland Company.