Cargill's Acquisition of Continental Grain's Grain Merchandising Business

Posted: 8 Sep 2000

See all articles by Marvin Hayenga

Marvin Hayenga

Iowa State University - Department of Economics

Robert Wisner

Iowa State University - Department of Economics

Abstract

This article examines the advantages and concerns raised from the proposed October 1998 Cargill acquisition of Continental Grain Company's grain merchandising business. The world's largest grain exporter acquiring the second largest exporter raised concerns about potential loss of competition, but also may make these firms with excess capacity more effective in competing for a larger U.S. share of the world market. The analysis below done in December 1998 was based on the quickly available and relevant data to provide information to industry, academic, and government analysts which might prove useful in debating the pros and cons of this acquisition. Subsequently, the July 1999 Department of Justice proposed consent decree and rationale for its settlement with Cargill is summarized, followed by some issues for the reader to consider.

JEL Classification: Q12

Suggested Citation

Hayenga, Marvin and Wisner, Robert Newell, Cargill's Acquisition of Continental Grain's Grain Merchandising Business. Available at SSRN: https://ssrn.com/abstract=237054

Marvin Hayenga (Contact Author)

Iowa State University - Department of Economics ( email )

260 Heady Hall
Ames, IA 50011
United States

Robert Newell Wisner

Iowa State University - Department of Economics ( email )

260 Heady Hall
Ames, IA 50011
United States

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