Bunge North America, the North American operating arm of Bunge Limited, announced that it has agreed to buy the rice milling business of Pacific International Rice Mills, LLC, a subsidiary of Anheuser-Busch, Inc.
The purchase is expected to close by the end of the year, subject to customary closing conditions. Financial terms were not disclosed.
Pacific International Rice Mills (PIRMI) produces bulk and packaged milled rice for domestic and export markets. The mill is located in Woodland, California, in the Sacramento rice growing region, 20 miles west of the Port of Sacramento.
"The purchase of PIRMI's business supports Bunge's strategy of expanding into adjacent value chains, and rice milling is a natural extension for us," said Soren Schroder, president and CEO, Bunge North America. "Bunge is a leader in the corn dry milling industry, and success in the rice milling industry relies on many of the same strengths: commodity origination, efficient milling operations, risk management, logistics and a customer-focused approach to business."
With an annual milling capacity of 363,000 metric tons, PIRMI sells to customers in the foodservice, food processing and export channels -- the same channels that Bunge successfully serves through its grain, milling and oils operations.
"PIRMI is a first-rate facility with talented employees who have developed a successful business selling rice to external customers," said Pete Kraemer, vice president of Supply at Anheuser-Busch. "In the process, our breweries have sourced more rice from other suppliers, as well as our rice mill in Arkansas. The sale of PIRMI will enable us to focus our rice milling operations on those used for our beers."
Bunge has been a supplier to Anheuser-Busch for more than 30 years, providing high-quality corn products for brewing. PIRMI will be among the suppliers Anheuser-Busch looks to for its rice purchases.
"We are pleased to have this opportunity to deepen our relationship with Anheuser-Busch and we look forward to working with PIRMI's employees, growers and customers to build on PIRMI's strong foundation to create new markets and develop new products," said George Allard, vice president and general manager, Bunge Milling. "A number of factors point to continued demand growth for medium grain rice including nutritional, demographic and dietary trends, and we are confident we can take advantage of these growth opportunities."
The plant currently operates with about 65 employees. Subject to its normal hiring procedures, Bunge intends to hire PIRMI's employees.