Minnesota-based food manufacturer Cargill has purchased minority stake in Kombinat Stroykomplekt (KSK), a deep sea port terminal in Novorossiysk on the Black Sea in Russia, from DeloPorts.
The company will own 25% plus one share indirect interest in KSK, a subsidiary of DeloPorts.
The KSK facility can handle 3.5 million metric tonnes of grain per annum, will add to Cargill's network of grain and port facilities; the company will use a part of volume capacity of the new facility and will make the remaining available to the market.
The purchase follows the company's announcement in September this year about constructing a sunflower oil crush plant in the Volgograd region of southern Russia.
Cargill Europe grain and oilseeds operations head Andreas Rickmers said this strategic investment is in line with their intention to grow their operations in Russia.
He said that this is the company's first investment in a Russian port on the Black Sea and will strengthen its offering to the market, providing a channel to connect its Russian grain operations to the rest of the world.
"Securing this vital step in their supply chain will also benefit Russian farmers, providing them with reliable access to global markets for their crops," Rickmers said. "It forms part of our growing focus to offer our farmer customers a range of services, advice and financial tools."
The company will continue to use other port facilities, including a joint venture in the Romanian port of Constantza on the Black Sea, to serve its customers across the world.
Cargill country representative and Russia food business head Natalia Orlova said this investment is mutually beneficial for the parties involved.
"It is an important element of our growing footprint in Russia, where we have been operating since 1991," Orlova said. "We have invested more than $900m across our portfolio of businesses in the country, making Cargill a leading investor in the agricultural sector."