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Glencore said seeking buyer for Viterra's U.S. pasta play

Glencore Xstrata is looking to sell its Dakota Growers Pasta Co. business, as it continues to divest assets acquired from last year's $6 billion purchase of Canadian grain handler Viterra, according to three sources with knowledge of the process.

Glencore is working with Barclays to sell Dakota Growers in a deal which could value the Minneapolis-area company, the third-largest pasta maker and marketer in the U.S., at $300 million to $400 million, the sources said Tuesday (all figures US$).

Glencore and Barclays could not be immediately reached for comment.

To please regulators, Glencore has already sold a number of Viterra assets to Canadian firms Agrium and Richardson International and U.S. fertilizer company CF Industries.

Dakota Growers is likely to draw interest from companies such as U.S.-based ConAgra Foods and Spain's Ebro Foods, one of the sources said.

Viterra bought Dakota Growers, the operator of one of North America's largest durum mills, for $240 million in March 2010.

Dakota Growers' production mainly goes to ingredients for other food companies but also to the foodservice and private-label retail sectors. It makes the Dreamfields brand of low-carb pastas, among about 100 different shapes of pastas including whole grain, multigrain and "omega-3" varieties.

The company started operations at Carrington, N.D., about 200 km northeast of Bismarck, in 1993, with the backing of about 1,100 U.S. Midwest farmers, using Italian durum processing equipment. It later bought a second pasta plant in the Minneapolis area.

-- Reporting for Reuters by Olivia Oran and Soyoung Kim in New York, with files from Network.

Related story:
Viterra to buy North Dakota pasta maker,
March 10, 2010


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