31 Aug 2017 --- South Korea’s CJ CheilJedang Corp plans to expand its portfolio now that it has acquired a 90 percent stake in Brazilian soy protein maker Selecta, one of the world’s largest producers of soy protein concentrate (SPC), which is used to produce animal feed. The sale was done for 450 million reais (US$143 million), according to a Reuters report.
Chile’s Corpesca SA PES.SN has sold its 60 percent stake, a statement from Selecta notes. Minority shareholders also agreed to sell 30 percent of the company, which reports US$360 million in annual revenue. Selecta says its name will change to CJ Selecta and that CJ has the option to acquire the remaining 10 percent stake in the next two years.
The acquisition of Selecta is important for CJ because it adds a valued vegetable protein feed ingredient business to its portfolio, Dawoon Jeong from the CJ CheilJedang PR team tells NutritionInsight. “Furthermore, based on CJ’s fermentation and enzyme technology, CJ will also be able to expand [its] portfolio into perse livestock including swine, fish, shrimp, poultry and pets,” Jeong adds.
“This acquisition is also meaningful for CJ in building synergy between CJ’s existing product and Selecta’s SPC,” Jeong says. “Selecta is the global No 1 company in [the] feed SPC business and sells its product to more than 37 countries, and CJ CheilJedang is also the global No 1 company in [the] feed amino acid business.”
Big plans for Brazil The Brazilian market should be important for CJ CheilJedang’s future. Jeong outlines some of its goals: “Brazil is a major producer of soybean, so it is easy to get GMO and N-GMO soybean meal […] furthermore, we could approach [the] N-GMO EU market [and] save logistics costs for America and Europe.”
CJ CheilJedang is planning to expand Selecta’s plant, Jeong adds. Going forward, both companies should complement each other while working together.
“Using synergy of the CJ CheilJedang sales network and Selecta’s sales network, we will increase global sales and market share. Furthermore, using CJ’s fermentation and enzyme technology, we will expand [our] portfolio into perse livestock,” Jeong explains.
The contract marks CJ’s debut in Brazil’s soy protein concentrate industry, where it already runs logistics, soy trading and bioscience businesses, Selecta says.
The company, whose current soy processing capacity is 700,000 tonnes, says it expects to increase production by 50 percent with investments promised by the new owner.
CJ CEO Chul Ha will host an event this week in Goiania, where Selecta is based, to provide additional details on its investment plans for Brazil, Reuters adds.
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