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ACQUISITIONS AND DISPOSITIONS | 6 Months Ended
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Jun. 30, 2023
Business Combination, Asset Acquisition And Discontinued Operations and Disposal Groups [Abstract] |
ACQUISITIONS AND DISPOSITIONS | ACQUISITIONS AND DISPOSITIONS Acquisitions Viterra Limited Business Combination Agreement On June 13, 2023, Bunge entered into a definitive business combination agreement (the "Agreement") with Viterra Limited ("Viterra") and its shareholders including certain affiliates of Glencore PLC, Canada Pension Plan Investment Board, and British Columbia Investment Management Corporation (collectively, the "Sellers"), to acquire Viterra in a stock and cash transaction. The acquisition of Viterra by Bunge will create an innovative global agribusiness company well positioned to meet the demands of increasingly complex markets and better serve farmers and end-customers. Under the terms of the Agreement, Viterra shareholders are anticipated to receive approximately 65.6 million of common shares of Bunge issued stock, with an aggregate value of approximately $6.2 billion as of June 30, 2023 and receive approximately $2.0 billion in cash (together, the "Transaction Consideration"), in return for 100% of the outstanding equity of Viterra. The determination of the final value of the Transaction Consideration will depend on the Company's stock price at the time of closing. Upon completion of the transaction, the Viterra sellers are expected to own approximately 30% of the combined Bunge company on a fully diluted basis, before giving effect to any future share repurchases by Bunge. In connection with the execution of the Agreement, Bunge has secured a total of $8.0 billion in acquisition debt financing ("Acquisition Financing"). Bunge intends to use a portion of the Acquisition Financing to fund the cash portion of the Transaction Consideration, and the remainder for repayment of certain indebtedness of Viterra, totaling approximately $6.6 billion, which is expected to be repaid at Closing and for the ongoing operations of the combined company following closing. See Note 13 - Debt for further information. The acquisition is expected to close in mid-2024, subject to Bunge shareholder approval and satisfaction of regulatory approvals and other customary closing conditions. The Agreement may be terminated by mutual written consent of the parties and includes certain customary termination rights. If the Agreement is terminated in connection with certain circumstances relating to the failure to obtain certain antitrust and competition clearances that are conditions to closing, Bunge would be obligated to pay the Sellers a fee of $400 million in the aggregate. Additionally, on June 12, 2023 in contemplation of the Agreement, Bunge's Board of Directors approved a $1.7 billion expansion of the existing share repurchase program for the repurchase of Bunge's issued and outstanding common shares. Approximately $300 million remained outstanding under the existing program prior to the expansion of the program, resulting in an aggregate of $2.0 billion that remains outstanding for repurchases under the program. See Note 17 - Equity for further details. Fuji Oils New Orleans, LLC Port Based Refinery On April 14, 2023, Bunge, through its 80% ownership of Bunge Loders Croklaan joint venture with IOI Corporation Berhad, completed its purchase of Fuji Oils New Orleans, LLC's port based refinery. The refinery is located in International-Matex Tank Terminals' Avondale Terminal, in Avondale, Louisiana in the United States. Cash consideration for the asset acquisition of $181 million was allocated to Property, plant and equipment, net ($220 million), inclusive of a finance lease right of use asset ($52 million), long-term finance lease obligations ($41 million) included in Long-term debt and Current portion of long-term debt, and other net working capital ($2 million). Dispositions Russian Oilseed Processing and Refining Operations Disposition On September 16, 2022, Bunge signed an agreement to sell its remaining Russian operations, primarily comprising an oilseed crushing and refining facility in Voronezh, southwest Russia (referred to as the "disposal group"), to Karen Vanetsyan (the "Buyer"), in exchange for a cash price approximately equal to the book value of the disposal group's net assets. On January 9, 2023, Bunge and the Buyer agreed to a purchase price adjustment. The purchase price adjustment and cumulative translation adjustment losses, among other items related to the disposal group, resulted in a corresponding impairment loss on sale of $103 million, recognized in Cost of goods sold for the year ended December 31, 2022. On February 3, 2023, the transaction closed in accordance with the terms of the agreement with no material impact to the condensed consolidated statement of income for the six months ended June 30, 2023. In connection with the transaction, Bunge agreed to indemnify the Buyer against certain legal claims involving Bunge's Russian subsidiary. Management has assessed the likelihood of any loss related to claims covered by the indemnity as remote, and recognized a liability in accordance with Accounting Standards Codification ("ASC") 460, Guarantees. See Note 15 - Commitments and Contingencies for more information. The following table presents the book values of the major classes of assets and liabilities that were included in the disposal group at the closing date. Intercompany balances between the disposal group and other Bunge consolidated entities have been omitted. Assets included in the disposal group comprised $12 million and $21 million, reported under the Agribusiness segment and Refined and Specialty Oils segment, respectively. Liabilities included in the disposal group comprised $6 million and $13 million, reported under the Agribusiness segment and Refined and Specialty Oils segment, respectively.
(US$ in millions) |  |
Cash and cash equivalents | $ | 19 |  |
Trade accounts receivable (less allowances of zero) | 15 |  |
Inventories | 33 |  |
Other current assets | 14 |  |
Property, plant and equipment, net | 24 |  |
Goodwill & Other intangible assets, net | 10 |  |
Other non-current assets | 8 |  |
Impairment reserve | (90) |  |
Total assets | $ | 33 |  |
Trade accounts payable and accrued liabilities | $ | 3 |  |
Other current liabilities | 16 |  |
Total liabilities | $ | 19 |  |

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- Definition The entire disclosure for business combinations, including leverage buyout transactions (as applicable), and divestitures. This may include a description of a business combination or divestiture (or series of individually immaterial business combinations or divestitures) completed during the period, including background, timing, and assets and liabilities recognized and reclassified or sold. This element does not include fixed asset sales and plant closings. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 805 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//805/tableOfContent Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 205 -SubTopic 20 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//205-20/tableOfContent + Details
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