(Bloomberg) -- ED&F Man Holdings Ltd. is exploring options for its brokerage unit that could result in the commodities trader selling a stake in the business or offloading it entirely, according to people familiar with the matter.
The brokerage arm of the London-based trader is in talks with partners for a deal that could value ED&F Man Capital Markets Ltd. at more than $500 million, said the people, who asked not to be identified because the information is private. The brokerage, which is looking for a partner willing to invest in its future growth, is working with PwC on the process, one of the people said.
The move comes as the parent company, a commodities trader best known for hauling sugar and coffee around the world, has been selling units and shedding assets to concentrate on its core business. The parent posted a pre-tax profit in the first half of the year after three years of losses.
A spokeswoman for ED&F Man declined to comment.
ED&F Man Capital Markets, founded by Chief Executive Officer Chris Smith, deals in everything from base metals to equities and foreign exchange. While the parent company has struggled to make money, the brokerage business remained profitable. In the six months ending March 31, the brokerage’s operating profit came in at about $40 million, the most of all of the group’s units.
Suedzucker AG, Europe’s top sugar producer, has a 35% stake in ED&F Man Holdings Ltd.
©2020 Bloomberg L.P.
