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Additional Investment in Brazilian Agricultural Production and Grain Distribution Business, Multigrain AG

Jan. 13, 2011


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Mitsui & Co., Ltd. ("Mitsui", head office: Tokyo, President and CEO: Masami Iijima) has agreed to acquire 44.2% (voting rights: 45.1%) of the outstanding shares of Multigrain AG ("MAG", head office: Switzerland) owned by CHS Inc. ("CHS", head office: USA, listed on NASDAQ) through its subsidiary CHSIH SA ("CHSIH", head office: Switzerland). MAG engages in the agricultural production business and the grain distribution business (origination, processing, logistics, export and marketing) in Brazil. With this acquisition, Mitsui's shareholdings in MAG will increase from 44.2% (voting rights: 45.1%) to 88.4% (voting rights: 90.1%), making MAG Mitsui's consolidated subsidiary. Mitsui's additional investment is US$225 million, with total investment of US$459 million.

Mitsui will strive to strengthen agricultural production and grain distribution business in Brazil, which has high potentiality of food supply, and to secure a stable supply of grain from Brazil mainly to Asian market, through MAG as a major subsidiary in Mitsui's grain business.

The global demand for grain is expected to increase as world population grows and as the economy in the emerging countries continues to improve. Mitsui will strive to strengthen its grain business as one of its core business areas, aiming to respond to the global demand for food and ensure food safety and security.

1. Change in Mitsui's Shareholdings in MAG

Please scroll horizontally to look at table below.

  Shares Holding
ratio
Voting
rights ratio
Total amount
paid by Mitsui
Before the additional investment 6,431,573 44.2% 45.1%  
Additional investment 6,431,573 44.2% 45.1% US$ 225 million
After the additional investment 12,863,146 88.4% 90.1%  

2. Date of Acquisition of Shares

This transaction will be completed upon approval from the Japanese, Brazilian and other authorities.

3. Outline of MAG

Corporate name Multigrain AG
Head office location Switzerland
Representative Nobuhiko Tomishima (Chairman of the board)
Business Own the 100% subsidiary Multigrain S.A. as its operating company in Brazil, engaged in the origination, processing, export and marketing of soybeans, corn and cotton, and import of wheat in Brazil. Through its 100% subsidiary Xingu AG, also owns Agricola Xingu S.A., which is involved in growing soybeans, corn and cotton, and in cotton ginning (producing ginned cotton from raw cotton), etc. in Brazil.
Amount of capital 145,485,000 Swiss Franc (as of March 31, 2010)
Established 2006
Major shareholders
(Before the additional investment)
CHSIH 44.2%, Mitsui 44.2%
Relationship with Mitsui
(Before the additional investment)
Capital : Mitsui's shares of ownership in MAG are 6,431,573 shares (holding ratio: 44.2%)
Personnel : 3 Directors (total members are 7) and 4 seconded employees as of date
Business : Trading of grains such as soybeans

MAG's Consolidated Operating Results and Financial Condition (IFRS): (Thousands of US$)

Please scroll horizontally to look at table below.

Fiscal year Year ended December
2007 2008 2009
Shareholders' equity 269,763 495,109 548,921
Total assets 830,597 1,060,422 1,285,195
Sales 514,541 985,407 1,254,279
Gross profit 17,351 14,057 22,815
Net Income 10,700 1,881 -11,619

4. Outline of CHS and CHSIH

Corporate name CHS Inc.
Head office location Minnesota, USA
Representative Carl Casale, CEO
Business A major grains and foods and energy company listed on NASDAQ. Operations include grain origination and export, and oil refining and sales.
Established 1936
Shareholders' equity US$ 3,335,664,000 (as of the end of August 2010)
Total assets US$ 8,666,128,000 (as of the end of August 2010)
Corporate name CHSIH SA
Head office location Switzerland
Representative Claudio Scarrozza, President
Business Investments in overseas J/V
Established 2006

5. Forecast

As a result of this additional investment, the forecast of Mitsui's consolidated financial results of the fiscal year ending March 2011 will not be changed. This transaction is expected to have only a negligible impact on Mitsui's consolidated financial results of fiscal year ending March 2011.

Notice:
This press release includes forward-looking statements about Mitsui. These forward-looking statements are based on the current assumptions and beliefs of Mitsui in light of the information currently available to it, and involve known and unknown risks, uncertainties and other factors. Such risks, uncertainties and other factors may cause Mitsui's actual results, performance, achievements or financial position to be materially different from any future results, performance, achievements or financial position expressed or implied by these forward-looking statements. The risks, uncertainties and other factors referred to above include, but are not limited to, those contained in Mitsui's latest annual report on Form 20-F, which has been filed with the U.S. Securities and Exchange Commission.
This press release is published in order to publicly announce specific facts stated above, and does not constitute a solicitation of investments or any similar act inside or outside of Japan, regarding the shares, bonds or other securities issued by us.

Information

For inquiries on this matter, please contact

Mitsui & Co., Ltd.
Investor Relations Division
Telephone: +81-3-3285-7910
Facsimile: +81-3-3285-9819
infoTKADZ@mitsui.com
Mitsui & Co., Ltd.
Corporate Communications Division
Kayo Kobayashi
Telephone: +81-3-3285-7618
Facsimile: +81-3-3285-9819