UPDATE 1-Saudi Arabia's SALIC boosts investment in G3 Canada grain company

(Adds farmer comment)
By Rod Nickel
WINNIPEG, Manitoba, June 17 (Reuters) - Saudi Arabia's
agriculture company has taken control of the majority investor
in grain handler G3 Canada Limited, according to a filing,
reducing Bunge Ltd's BG.N stake and strengthening the
kingdom's efforts to secure food supplies.
G3 Global Holdings, the joint venture of U.S. agribusiness
Bunge and Saudi Agricultural and Livestock Investment Co
(SALIC), bought 50.1 percent of the former Canadian Wheat Board
in 2015 for C$250 million ($194.22 million). It was renamed G3
Canada, with farmers accounting for 49.9 percent of equity.
In two steps this year, SALIC, an arm of the state-owned
Public Investment Fund, grew its stake in the joint venture to
75 percent from 49 percent, according to an April 28 Bunge
filing.
"Any ownership changes that have happened within our company
have not had any material impact on the organization itself, the
operations or how we run the company," G3 Canada Chief Executive
Karl Gerrand said in an interview.
SALIC has "done a really nice job of allowing our team to
operate as an independent Canadian organization," he said. "For
the most part, it's been hands-off."
He declined to comment on reasons for the ownership change.
SALIC converted $106 million in promissory notes into
additional shares in the joint venture with Bunge on Feb. 1.
This took its stake in the majority investor of Winnipeg-based
G3 to 65 percent from 49 percent, and reduced Bunge's share to
35 percent.
Bunge then exercised an option on March 30 to sell shares to
SALIC for $37 million, bumping up SALIC's ownership of G3 Global
Holdings to 75 percent.
SALIC could not be reached. Bunge spokeswoman Deb Seidel
declined to comment.
Saudi has been phasing out crop farming due to its intense
water usage in the desert kingdom. SALIC has targeted
investments in beef and eight key crops, including wheat. Canada
is a major wheat exporter.
Farmers' equity accounts for the same number of shares in
G3, however its percentage of ownership has dropped because of
recent investments by the SALIC-Bunge joint venture into the
company, Gerrand said. He declined to give a current percentage.
Keith Degenhardt, a farmer and first vice president of the
Alberta Federation of Agriculture, was disappointed when foreign
investors bought the former Wheat Board, but said any dilution
of farmer equity is "not top of the mind."
G3 is a small Canadian player compared to competitors
Richardson International, Viterra Inc VILC.UL GLEN.L and
Cargill Ltd CARGIL.UL .
($1 = 1.2872 Canadian dollars)