Cargill, and the Argentinean food processing major Molinos Rio de La Plata decided to joint venture on a 65/35 basis in a new company to manage their industrial flour assets in Argentina and Paraguay. Cargill is to pass on to the new j.v. its four mills at Santa Fe (2 units), Cordoba, and Chaco, and Molinos brings in six mills in Argentina and a stake in a mill at Paraguay, in addiktion to the flour complex recently dedicated at Pilar, Buenos Aires province, with capacity to process1,200 m tons of wheat per day, and to absorb investments of US$35mil. As a consequence, Cargill will pay US$30mil to Molinos to justify its largest stake in the venture, and is relatively less asssets. The Argentinan wheat flour market is estimated at US$1.1bil, led by Molinos with 15% - 16% of it, followed by Navalli,Lagomarsino, and Cargill with a 9%-10% share. With the merge of the flour assets from both Cargill and Molinos, the new company will have a 20% share in the market since par of the milling capacity wil be for the captive consumption of Molinos.
Source: El Cronista Page: 24 Date: May 10, 1999 Country: Argentina Product: Millinery/Flour Company: Cargill ; Molinos Rio de la Plata Event: Joint Ventures SABI (South American Business Information)