Chicago-based agricultural giant Archer-Daniels-Midland Co.'s CEO and Chairman Juan Luciano said the company will not pursue "monster" acquisitions at the moment, Reuters reported Jan. 16.
Luciano said high valuations and competition mean the time is not right for big deals, but the company could change course when credit tightens and competition lessens.
Luciano also confirmed that Archer Daniels Midland had looked at a possible deal for grain merchant Bunge Ltd., which is reportedly preparing to replace CEO Soren Schroder, but declined to confirm whether it had made a formal bid.
The executive said a Bunge acquisition is not urgent since Archer Daniels Midland "has a lot of the things that Bunge has" and could face obstacles from both domestic and international regulators.
Archer Daniels Midland is the only major agricultural trader without crushing capacity in Argentina, the world's main soy meal and oil exporter, leading investors to expect a deal with Bunge or Argentine soy company Molinos Agro S.A., Reuters reported. Luciano said the company will enter the country "at the right time."
Bunge shares fell about 2% after Luciano's comments were published.
On Jan. 11, Archer Daniels Midland said it will acquire citrus-based flavors and fragrances company Florida Chemical Co. Inc. for $175 million. On Jan. 17 it announced a deal for the remaining 50% stake in U.K. food distributor Gleadell Agriculture Ltd. it did not previously own.