Archer Daniels Midland Company
) hit a new 52-week high of $45.95 on Thursday, Jul 3, 2014, after
the leading global financial information provider Bloomberg
announced that the company is close to taking over Wild Flavors
Inc., a provider of naturally sourced flavor for beverages and
Bloomberg quotes that the agri-business giant outbid the closest
Japanese rival Ajinomoto Co, Inc. by making a buyout bid of 2.5
million Euros (or approximately $3.4 billion). However, according
to sources, Ajinomoto still stands a chance as the deal has not yet
Privately held company, Wild Flavors is the world's sixth
largest provider of naturally sourced flavors for food and
beverages with a turnover of $838 million in 2012. The company has
manufacturing facilities across the Americas, Asia, Europe and the
Currently, Hans-Peter Wild, son of founder Rudolf Wild own 65%
of Wild Flavors' stake while the remaining stake is held by KKR
& Co. In 2012, the company acquired Cargill Inc.'s juice blends
business and added approximately $200 million to its total
revenues. Apart from this, the acquisition also sets the platform
for Wild Flavors to grow its business in Asia and North
We believe that the transaction if concluded will facilitate
Archer Daniels' diversification of its business portfolio from
grain processing to provider of natural flavors for food and
beverages. Moreover, the deal will also fulfill the company's
target of investing over 60% of its capital expenditure toward
expansion and gaining a foothold outside the U.S. If the deal
finalizes, it will be the biggest acquisition of Archer
We have observed that Archer Daniels is undertaking strategic
steps to manage its business portfolio, which is expected to help
in realizing value from its businesses and investing the same in
best possible resources to enhance returns. This is evident from
the company's recent move of vending its South American fertilizer
business and acquiring the remaining 20% minority stake of Alfred
C. Toepfer International from Union InVivo.
Other Stocks Worth Considering
Archer Daniels currently carries a Zacks Rank #4 (Sell).
However, some better-ranked stocks in the agricultural products
Wilmer International Limited
), all these carrying a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research?
Today, you can download 7 Best Stocks for the Next 30 Days.
Click to get this free report
ARCHER DANIELS (ADM): Free Stock Analysis
LIMONEIRA CO (LMNR): Free Stock Analysis Report
ADECOAGRO SA (AGRO): Free Stock Analysis Report
WILMAR INTL LTD (WLMIY): Get Free Report
To read this article on Zacks.com click here.