PARIS, March 1 (Reuters) - U.S. grains merchant Archer Daniels Midland Co has agreed to take a 50 percent stake in Russian agricultural group Aston’s starch and sweeteners activities as it continues to boost its presence in the expanding food ingredient market.
Chicago-based ADM, which buys, stores and ships commodity crops, has been trying to invest in higher-margin markets such as corn and wheat syrup to boost earnings in volatile commodity markets and squeezed margins due to low prices.
It purchased French wheat-based starch and sweeteners producer Chamtor last year, after acquiring corn facilities in Hungary, Bulgaria, Turkey and Morocco in 2015 and 2016.
ADM also has a sweetener facility in Tianjin, China.
Aston has two corn wet mills located southeast and east of Moscow and controls 15 percent of the country’s starch and sweeteners market, a source close to the deal had earlier told Reuters.
The financial terms of the deal, which is expected to close late in the second quarter of this year following a regulatory review, were not disclosed.
The deal follows ADM’s announcement on Monday it would launch an soybean crushing joint venture with Cargill in Egypt.
Aston also produces and exports vegetable oils and is a major grain exporter taking part in tenders by one of the world’s largest importer Egypt. (Reporting by Sybille de La Hamaide Editing by Sudip Kar-Gupta and David Evans)