Singapore agrifood firm Olam picks London for GBP2 billion IPO

(Alliance News) - Singapore-based agricultural giant Olam International Ltd on Friday said it has chosen London for the initial public offering of its food ingredients business.

Olam is in the process of demerging its two units - Olam Food Ingredients and Olam Global Agri. OFI supplies ingredients and products made from cocoa, coffee, nuts, spices, and dairy. The IPO is planned for the first half of 2022, and will be joined by a secondary listing on the Singapore Stock Exchange.

OFI is planning to raise about GBP2 billion, Reuters reported on Friday, citing sources familiar with the matter. Citigroup Inc, Credit Suisse Group AG, HSBC Holdings PLC, JPMorgan Chase & Co and Morgan Stanley have been appointed to work on the IPO, according to Reuters.

In the first half of 2021, OFI made revenue of SGD6.8 billion - about USD5.0 billion - and earnings before interest and tax of SGD316.3 million.

Olam International is currently listed in Singapore, with a market capitalisation of SGD5.59 billion, equivalent to USD4.11 billion. It is controlled by the country's sovereign wealth fund, which has a 54% stake.

The Global Agri unit, which supplies animal feed, rice, palm oil and cotton, is the larger of the two units. It made SGD15.5 billion revenue and SGD407.5 million profit in the first half.

OFI Chief Executive Anantharaman Shekhar said: "The primary listing on the LSE will give us access to London's large and diverse investor base, with its deep and liquid capital markets, and enable us to benefit from its strong understanding of and research coverage across the food and beverage sector.

"Our integrated global network, servicing large, attractive and growing end-use categories, within an expanding on-trend ingredients portfolio, makes us a compelling investment case for anyone looking to tap into growing global demand for food that is healthier, traceable and sustainable."

By Ivan Edwards; ivanedwards@alliancenews.com

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