COFCO Announces IPO Three Years Out

By Lauren Dodillet

China’s largest state-run grain trading company announced at the end of October that it was planning to launch an IPO within three years. China National Cereals, Oils, and Foodstuffs Corporation (COFCO) CEO Frank Ning said the company will prioritize vertically integrating its newest acquisitions, grain exporters Nidera LLP and Noble Agri Ltd., before going public. Ning also said that the company has no plans for more major acquisitions in the short term.

COFCO shares Nidera and Noble Agri with several partners and has subsidiaries listed on both Hong Kong and mainland stock exchanges, making it difficult to predict where the company will ultimately file its IPO—and whether its other subsidiaries will be included. Nidera and Noble Agri are confirmed as part of the future IPO.

COFCO acquired the two grain exporters earlier this year for a combined $3 billion, raising its overall annual revenue to $63.3 billion, its processing capacity to 84 million metric tons, and its annual storage capacity to 15 million metric tons. The acquisitions pushed COFCO’s overseas revenue above its domestic revenue for the first time.

Ning said he hopes the IPO will help COFCO contend with other global agribusiness companies, though its annual revenue is still less than half that of US-based Cargill, Inc.

(Photo by Claire Deweggis via Flickr)