SINGAPORE (Jan 20): Global food and agri-business Olam International is reorganising its business into two new distinct operating groups focusing on food ingredients and global agri-business.
The revamp is part of the group's new strategic plan set out in January last year and is expected to the group’s portfolio and sharpen its focus.
It will also enable investors to participate in two diverse themes via potential carve-outs or initial public offerings (IPOs), the group reported on Monday.
Olam International will hold the two new operating groups, thereby providing a parenting advantage by enabling synergies and accelerating growth.
Olam Food Ingredients (OFI) will comprise of Olam's cocoa, coffee, edible nuts, spices and dairy businesses. It will be spearheaded by A Shekhar, who has been appointed as the CEO of OFI. Shekhar will step down from his current role as Olam’s chief operating officer with immediate effect.
Olam Global Agri (OGA) constitutes the group’s grains and animal feed, edible oils, rice, cotton and commodity financial services businesses. Sunny Verghese will hold charge as CEO of OGA, in addition to continuing as the group’s CEO.
“By simplifying our businesses across two distinct and coherent groups, each with a clear vision for profitable growth, it sharpens our focus and provides opportunities to capitalise on key market trends, while continuing to leverage the benefits of the Olam Group,” says Verghese.
“We believe this will enable us to explore potential carve outs and IPOs in a sequential manner and attract additional investors who are aligned with the vision of these two new groups in order to maximise the value of our business,” he adds.
Olam International will hold the two new operating groups. This will enable the group to create synergies and accelerate growth by developing the gestating businesses to full potential and incubating new businesses while releasing capital from divestments
The group’s gestating businesses include its packaged foods, infrastructure and logistics, and Olam Palm Gabon.
As at 10.41am, shares in Olam are trading seven cents higher, or 3.7% up, at $1.95.
