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Cargill to acquire Brazil's SGS Microingredients to expand industrial oils business

FBR Staff Writer Published 14 November 2016

Cargill has agreed to acquire Brazil-based SGS Microingredients for an undisclosed sum in a move to expand its business in the industrial oils segment.

The acquisition of SGS Microingredients is said to be in line with Cargill’s growth strategy in the Parana province.

Located in Ponta Grossa, SGS is into processing and production of oleo chemicals and emulsifiers for the food, industrial and animal nutrition sectors, for both domestic and export sales.

Cargill Industrial Specialties in Brazil general manager Paul Hoffmann revealed that Cargill intends to grow its existing production capacity in the line of industrial products besides acquiring non existing capabilities that are missing in its assets.

Hoffman said that SGS Microingredients plant through its capabilities and complementary processes would add value to Cargill’s current chain Industrial Specialties to match market needs.

He added: "Currently, the company has an important position within the industrial oil market, with innovative solutions, high added value and good perception by customers. Our goal is to be a leader in providing biosolucoes and bioproducts to replace petroleum oil.”

SGS Microingredients has a production capacity of 56,000 tons per year in its plant. It has 80 employees who will be absorbed into Cargill post-acquisition.

The acquisition is subject to regulatory approvals of the Administrative Council for Economic Defense.

Cargill also has a industrial oils producing plant in Mairinque, Sao Paulo. The company said that the new acquisition would not impact its 90 employees at the Mairinque plant.

Last month, in Canada, Cargill disposed off its egg processing facility in Etobicoke to Global Egg.

Image: Cargill to buy Brazil-based SGS Microingredients. Photo: courtesy of Cargill, Incorporated.