Commodities and mining giant Glencore PLC has made a £3.5-billion ($5.5-billion) approach for Regina-based Viterra Inc. , Canada's biggest grain handler, Britain's Sunday Telegraph newspaper said on its website.
The London-based paper did not cite sources, but said it Glencore had approached Viterra. The Canadian company said on Friday it had received expressions of interest from third parties.
Shares of Viterra spiked 24 per cent in Toronto on Friday after a brief trading halt, during which the company disclosed interest from parties it did not name. Viterra's market cap soared to more than $5-billion with the stock surge.
Viterra is one of three big grain handlers in Canada – along with privately held Richardson International Limited and Cargill Ltd. – and the only one that is publicly traded. Interest in the company comes as the Canadian government moves to eliminate the Canadian Wheat Board's 69-year-old wheat and barley marketing monopoly in Western Canada on Aug. 1.
That change will eventually add between $40-million and $50-million to Viterra's annual earnings, the company has said, as it can buy wheat and barley directly from farmers for the first time.
Canada is the world's leading exporter of spring wheat, durum, canola and oats.
Viterra also owns grain handling assets in South Australia.
Glencore chief executive Ivan. Glasenberg told The Globe and Mail he would not comment. Viterra representatives did not immediately respond to requests for comment from Reuters.
Glencore is also attempting a $36-billion merger with mining group Xstrata PLC, and has expressed interest in buying U.S. energy and grains trader Gavilon Group, according to a source familiar with the matter.