ADM Selects Chicago for New HQ - Analyst Blog


After extensive analysis, the agri-business giant Archer Daniels Midland Company ( ADM ) chose Chicago for its new global headquarters and customer center, moving from its present day location at Decatur, Ill. However, the company is yet to finalize a suitable site for its headquarters in the city.

Archer Daniels believes Chicago is strategically positioned to provide easy access to the worldwide markets besides facilitating the company to enhance its relationship with the U.S. farmers, consumers as well as operations. Additionally, the city provides ample scope to enlarge its workforce with the availability of enormous professional expertise.

As part of the relocation, the company has decided to move a corporate team of 50 - 75 employees to its Chicago headquarters, against its initial plan of moving 100 high profile jobs to the center.  

Further, the company has withdrawn its plan of building an information technology (IT) center at its new headquarters and is now on the lookout for a new site to establish the IT and support center. The new IT center is expected to generate an additional employment for 100 people. While the company is evaluating locations in various states, it expects to narrow down on an appropriate site by mid-2014.

However, the company plans to retain Decatur as its North American headquarters. The workforce of 4400 at Decatur remains in place and the company has not planned any layoffs.  

Archer Daniels' endeavor to constantly expand its footprint and enhance customer services led to the decision of establishing a new global center that will allow it to work more competently with customers and employees across the globe. Further, the lack of several modern facilities including a big airport compelled Archer Daniels to move out of its longtime headquarter in Decatur, which is comparatively a smaller city with limited skilled workforce.

We believe this Zacks Rank #3 (Hold) company's decision to relocate is a strategic fit for its expansion plans. Moving the global headquarters to a bigger city with modern facilities with help the company to regulate its operations more effectively and consequently bolster its performance. Archer Daniels is a major agricultural processor that competes with Bunge Ltd ( BG ), Limoneira Co. ( LMNR ) and The Andersons Inc. ( ANDE ).

ARCHER DANIELS (ADM): Free Stock Analysis Report

ANDERSONS INC (ANDE): Free Stock Analysis Report

BUNGE LTD (BG): Free Stock Analysis Report

LIMONEIRA CO (LMNR): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: ADM , ANDE , BG , IT , LMNR

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