OTTAWA (Reuters) – Canada’s Competition Bureau on Tuesday said it had identified major competition concerns around the proposed merger between U.S. grains merchant Bunge (NYSE:) and Glencore-backed Viterra.
In a statement, the bureau said the deal was “likely to result in substantial anti-competitive effects and a significant loss of rivalry between Viterra and Bunge in agricultural markets in Canada”.
It also determined that the transaction was to likely to harm competition in markets for grain purchasing in Western Canada, as well as for the sale of canola oil in Eastern Canada.
The report was sent to Canada’s transport ministry, which has until June 2 this year to review the deal. The federal Canadian government will take a final decision.
The bureau said last June it would review the merger, which would create an agricultural trading giant worth about $34 billion, including debt.
The deal would bring the combined company closer in scale to leading rivals Archer-Daniels-Midland and Cargill.
Bunge has filed for regulatory approvals for the merger in “major jurisdictions” in North and South America, Europe and China, Chief Executive Officer Greg Heckman said last November.