New chief executive officer Analyst says Mayo Schmidt’s involvement in negotiations with Glencore may signal a desire for acquisition skills
PARIS, France (Reuters) — Louis Dreyfus Commodities has named Mayo Schmidt, former head of Viterra, as its new chief executive officer in the latest stage of a corporate shake-up at the 163-year-old global trading firm.
Louis Dreyfus is trying to sustain growth as the major grain companies vie with newcomers such as Glencore to acquire assets.
Schmidt’s appointment Nov. 28 was in line with the trading house’s preference for an external candidate and comes after it raised the possibility of a share listing or a tie-up with a partner in the future.
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Traders and analysts said Schmidt’s track record of acquisitions at Viterra fitted with the company’s plans to expand more aggressively, although his appointment was a surprise be-cause his name had not been cited in the market.
Schmidt, 57, oversaw the expansion of Viterra into Canada’s biggest grain handler during a 12-year reign before stepping down in 2012 when the Canadian firm was acquired by Glencore for $6.1 billion.
“Negotiating with Glencore on the sale of Viterra, he achieved an excellent price, and if Louis Dreyfus ever wants to IPO or sell part of their business, he might be the right person to do it,” a European trader said.
Louis Dreyfus is a leading trader and processor of agricultural goods including sugar, rice, wheat and cotton. It says it wants to spend $4 billion over the next five years as it attempts to double its sales from nearly $64 billion last year.
The group recently turned to bond markets for the first time, with three issues in the past two years.
Margarita Louis-Dreyfus, who inherited control of the company when her husband, Robert, died in 2009, has overseen several leadership changes since long-standing CEO Serge Schoen stepped down in June 2013.
“His (Schmidt’s) broad and global experience in the food industry, combined with his leadership skills, entrepreneurial attitude, strong business ethics and team-oriented mindset, make him the best person for the job,” she said in a statement.
Schmidt’s appointment breaks with a series of internal promotions and may mark a change of style at Louis Dreyfus.
“He’s known as hands-on. He’s not a European; he’s more North American and gets on with the job,” said James Dunsterville, an analyst at Geneva-based AgFlow.
“They may be taking him on as someone who knows how to acquire companies.”
Schmidt built up Viterra by acquiring larger rival Agricore United and then Australia’s ABB Grain Ltd.
Prior to Viterra, he held positions at U.S. food groups ConAgra Foods and General Mills.
He is currently on the board of Agrium Inc.
Schmidt will assume his new role Jan. 5, taking over from interim CEO Claude Ehlinger, who will become deputy CEO in addition to his existing role of finance director.
