Ismail Shakil

OTTAWA (Reuters) - Canada on Tuesday gave conditional approval to the $34 billion merger of U.S. grains trader Bunge and Glencore-backed Viterra, clearing the final hurdle in global agricultural cooperation. For one, the dollar value of this collaboration is unprecedented.

Conditions for the approval include Bunge divesting six grain elevators in Western Canada and Bunge making a binding commitment to invest at least C$520 million in Canada over the next five years, according to a statement from the Department of Transportation. $362 million).

The approval also requires strict and legally binding controls on Bunge's minority stake in Saudi grain company G3 to ensure Bunge cannot influence G3's pricing or investment decisions, the ministry said. Bunge, Viterra and G3 combined account for one-third of Western Canada's elevator capacity.

The merger, announced in 2023, would create a global crops trading and processing giant worth $34 billion, including debt, that would be as large as archrivals Archer-Daniels-Midland Co and Cargill Inc. is closer.

"With Canada's approval, we are nearing completion of the regulatory process and expect to close in early 2025," Bunge said in a statement to Reuters.

The deal, which was approved by shareholders, will put the combined company in a better position than its rivals to take advantage of an expected surge in demand for soybeans and canola oil to produce biofuels in the coming years, but more consolidation in the industry puts farmers at risk. There are fewer and fewer homes. crop.

Canada's antitrust regulator expressed concerns about the deal in April, saying in a non-binding report that the deal could harm competition in grain purchases in western Canada and canola oil sales in eastern Canada.

The Department for Transport said its conditions addressed concerns raised during the public interest review of the acquisition.

Bunge CEO Greg Heckman said he doesn't see a need for Canadian remediation.

In concluding the deal, the Transport Minister requested the establishment of a price protection program for certain purchasers of canola oil in Central and Atlantic Canada to maintain fair pricing and market stability.

"This decision underscores the importance of promoting Canada's economic growth while maintaining strong oversight to protect competition and the public interest," Transportation Minister Anita Anand said in a statement.

(1 USD = 1.4355 Canadian dollars)

(Reporting by Ismail Shakir in Ottawa and additional reporting by Tom Polansek in Chicago; Editing by Chris Reese and Sonali Paul)