OTTAWA (Reuters) – Canada’s competition bureau said on Tuesday it had identified serious competition concerns surrounding a proposed merger of U.S. grain traders. Bunge (NYSE:) and Glencore-backed Viterra.
The bureau said in a statement that the transaction “is likely to result in significant anti-competitive effects and a significant loss of competition between Viterra and Bunge in Canadian agricultural markets.”
It also determined that the transaction would likely harm competition in grain purchasing markets in Western Canada as well as canola oil sales in Eastern Canada.
The report was sent to Transport Canada, which must review the deal by June 2 of this year. The Canadian federal government will make the final decision.
Last June, the bureau said it would consider a merger that would create an agricultural trading giant worth about $34 billion, including debt.
The deal will bring the combined company closer in scale to leading competitors Archer-Daniels-Midland and Cargill.
Bunge has applied for regulatory approval for the merger in “major jurisdictions” in the Americas, Europe and China, CEO Greg Heckman said last November.