Olam International, the global agricultural commodity trading giant, is considering raising £2bn through the IPO of its London-based food ingredients unit next year, the firm has announced this morning.
Five global banks have been appointed to work on the IPO, which would likely rank among the biggest offerings in London over the last few years.
Citigroup, Credit Suisse, HSBC, JPMorgan and Morgan Stanley are the reported banks set to the task by Olam, sources told Reuters.
The company, backed by Singapore state investor Temasek Holdings and Mitsubishi Corp, declined to comment on the fundraising amount – but today said that it would pursue a primary listing for its food ingredients business in London and a secondary listing in Singapore by the first half of 2022.
The IPO forms part of Olam’s restructuring plan in which it will split its portfolio of products into two new operating businesses in a bid to better position itself to a different set of global investors.
Olam Food Ingredients (OFI), in London, includes Olam’s cocoa, coffee and edible nuts businesses, while Olam Global Agri covers grains and animal feed, edible oils, rice and cotton and other commodities.
OFI generated annual revenues of $9.1bn (£6.6bn) in 2020. Olam’s 2021 interim results were also announced today, buoying confidence in the group which reported revenue growth of 34 per cent compared to the same period last year.
Chief executive officer A. Shekhar said listing on the London Stock Exchange would give Olam “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.”
“The concurrent listing in Singapore,” he added, “will also enable us to retain our strong local shareholder base and further tap into growing investor appetite in Asia.”
The news was first reported by Reuters.