Temasek Unit Gets Control of Olam With 80% at Takeover Bid Close

May 23, 2014 10:54 am ET

May 23 (Bloomberg) -- A unit of Singapore’s state-owned investment company Temasek Holdings Pte. raised its stake in Olam International Ltd. to 80 percent, gaining control of the commodity trader.

Temasek’s Breedens Investments Pte and its related parties own or control 80 percent of Olam, they said late today in a statement to the Singapore stock exchange. Breedens on its own now has 49 percent of Olam’s share capital, according to the statement. Temasek held 24.6 percent of Olam through its unit Breedens and Aranda Investment Pte when it made the takeover bid, it said on March 14.

The unit in March bid S$2.23 each for the shares of Olam it didn’t own. The bid, made in cooperation with Olam founders the Kewalram Singapore Ltd. group and managers led by Chief Executive Officer Sunny Verghese, valued one of the world’s top three coffee and rice traders at S$5.3 billion$ ($4.2 billion). The offer closed today.

Olam shares rose 0.5 percent to S$2.24 each in Singapore trading today. The stock has climbed 46 percent this year.

The acquisition draws a line under the 2012 short-seller attack on Olam by Muddy Waters LLC, which questioned its finances and caused its stock to plummet. Temasek was Olam’s second-largest shareholder with about 16 percent at the time of the attack.

Breedens intends to keep Olam as a listed company, unless the minimum float requirements of 10 percent aren’t met, it said in March.

Little known to retail consumers, one of every eight chocolate bars eaten globally is made from beans handled by Olam, while the trader produces enough cotton to provide all the world with three pairs of socks each year. The quantity of rice it handles annually could feed all of Africa for a week.