Singapore-listed commodities company Olam International struck a deal on Tuesday to buy US grains giant Archer Daniel Midland’s cocoa business at an enterprise value of $1.3 billion, in its largest acquisition to date.
The acquisition of ADM will propel Olam into the ranks of the top-three bean processors in the world, alongside Cargill and Barry Callebaut, but the upshot is that the company will not meet previous targets to turn cash flow positive this year.
Olam had came under attack from short-seller Muddy Waters in 2012 after its founder Carson Block questioned the company's accounting practises, mounting debt levels and acquisition track record.
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