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Bunge, Viterra merger would create global agriculture trading giant

A merger of U.S. grains merchant Bunge Ltd (BG.N) with rival Viterra would grow the combined entity's businesses in the U.S., Brazil and Australia and may raise competition concerns in parts of Canada and Argentina, where key oilseed processing assets overlap, analysts said.

Sources last week said Bunge and Glencore Plc-owned Viterra (GLEN.L) were in talks for a potential mega deal that would further consolidate global agriculture trading and bring Bunge closer in global scale to leading rivals Archer-Daniels-Midland Co (ADM.N) and Cargill Inc (CARG.UL).

"Combining Bunge and Viterra in regions like North America and Europe certainly would strengthen the combined company's presence there and put them more on par with ADM," said Seth Goldstein, equity analyst with Morningstar.

"Bunge is already the leader in South America. That might be a region where there might be some divestitures required if a deal were to close there to make sure that there's still competition," he added.

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