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Exclusive: China's COFCO in talks to buy Noble's agribusiness arm - sources

BY NAVEEN THUKRAL AND DENNY THOMAS
Tue Mar 4, 2014 8:17am EST

(Reuters) - China's biggest grains trader COFCO Corp is in talks to buy Noble Group Ltd's agribusiness arm in a deal that would value the division at around $1 billion, people familiar with the matter said.

Buying into the Noble unit would help China develop a powerful agricultural trading house, an entity the country has lacked. Chinese trading firm Unipec is already one of the world's biggestcrude oil buyers.

State-backed COFCO, which last week agreed to buy a 51-percent stake in Dutch grain trader Nidera, is conducting due diligence on the Noble unit, said the sources who declined to be identified because the matter is not yet public.

The precise stage of the talks was not clear, the people said, cautioning that a deal may or may not materialize for the unit which trades and processes grains. The final structure of the deal is still under discussions.

Noble shares jumped as much as 8.6 percent to S$1.075, the highest since January 2 after the Reuters story, adding around $450 million in market value. The benchmark Straits Times Index .FTSTI was 0.

Noble Group said in a statement that it was currently engaged in discussions with a consortium over a potential joint venture around its agriculture business, but no binding arrangements had yet been entered into. The Noble statement did not identify COFCO as part of the consortium.

Noble's grains and oilseeds operations focus on South America, Europe and Asia. It operates three oil seed processing factories in Asia, and supplies grains, oilseeds, vegetable oil and by-products throughout the region from Singapore.

A COFCO spokesman said he was not aware of talks with Noble.

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