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Bunge Ltd (NYSE: BG), a global provider of agricultural consignment services, is seeing shares rise today following reports of merger talks with rival Viterra Inc.
Bunge’s shares opened at $70.90 today and have since risen to $72.89 as of 2:30 p.m. New York time. Reports of the merger talks, which according to sources close to the matter emerged earlier this month, have added fuel to the share price lift.
The market is now eagerly awaiting a potential deal between the two firms which would significantly shake up the global grain industry.
If the merger comes to fruition, the unification of Bunge and Viterra’s agricultural services would create an added lever of scale for the two companies. This could drive costs down and could potentially put them in a position to potentially compete with the market leader Archer Daniels Midland Co. (NYSE: ADM).
The market remains hopeful that a potential merger of the two companies would be a win-win for both of them. For Bunge in particular, it could potentially be a chance to drastically reduce their debt burden and open up a whole new avenue of growth.
At this time, no official statement has been made from either of the companies, and the rumored merger could potentially still crumble. Regardless, the market is clearly betting on the potential upside of this combination as Bunge’s share price continues to rise.