NEW YORK (Dow Jones)--Archer Daniels Midland Co. (ADM) may take advantage of the economic downturn to buy heavily discounted assets, Chief Financial Officer Steve Mills said Tuesday. Potential deals could bring ADM into new business areas, like ocean-shipping. "We believe that the current economic downturn may provide us with opportunities to grow our global footprint in an economic way," he said, addressing the annual conference of the Consumer Analyst Group of New York, in Boca Raton, Fla. ADM, a large user of ocean freight, has opted not to own its own fleet of ocean-faring ships in the past. The company is analyzing the possible purchase of a small fleet, Mills said. ADM also has the opportunity to buy assets in its established businesses at a fraction of their full value, Mills said. He noted that many U.S. corn-based ethanol plants are currently distressed, but said ADM sees long-term value in producing the fuel. Acquisitions in any part of ADM's business would be based on the idea that global agribusiness will become increasingly profitable as the economy improves (Dow Jones Newswires 05:26 PM ET 02/17/2009)
I dont know about the future of ethanol, but the shipping supply line fits right in with adm core business. In any given year adm will make a business out of bringing ag commodities from areas of plenty to areas of need. If adm can take the advantage of distressed prices for some assets its going to max its growth potential. Shows how adm is one of the few companies in one of the few sectors that is going to grow even while the economy idles for a while. As long as they dont get over extended. long term this is good news, lots of synergy in having all the shipping ability.