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Louis Dreyfus to wind down Edesia commodity funds in overhaul

LONDON/PARIS (Reuters) – Louis Dreyfus will wind down the fund management activities of commodities specialist Edesia Asset Management by the end of the year as part of its drive to focus on trading and processing of agricultural goods.

Edesia will phase out all third-party funds and associated accounts it manages by Dec. 31, Louis Dreyfus Holding B.V. said in a statement on Tuesday.

“This is in line with the group’s strategic decision to focus its resources on its core physical operations as a merchant and processor of agricultural goods,” it said.

The trading house, which dates back to 1851, is planning to sell stakes in several non-core activities as it tries to reverse two years of falling operating profits linked to shrinking margins in agricultural commodity markets.
Edesia Asset Management, which is wholly owned by Louis Dreyfus Holding, was established in 2008 and manages more than $1.4 billion in assets, supported by offices in London and Geneva.

This compares with over $2.7 billion in assets as of Aug. 1, 2013, when it had offices in Geneva, London, Singapore and Wilton in the United States, according to information on Louis Dreyfus Holding’s website.

Edesia CEO Ian McIntosh pointed in Tuesday’s statement to a positive performance of its funds.
“In challenging market conditions, our flagship products have generated cumulative net returns of 42 percent and 70 percent respectively since inception,” he said.

“We anticipate the net asset values at closure of the funds to be at or close to the highest point in their history.”
No one at Edesia was immediately available to comment further.

Louis Dreyfus [AKIRAU.UL] is the “D” of the so-called ABCD quartet of trading houses – alongside Archer Daniels Midland, Bunge and Cargill [CARG.UL] – that dominates agricultural commodity trading.
Like its peers, it has been reorganizing in response to a period of high supply and reduced price volatility that have eroded margins for buying, selling and shipping agricultural goods.
The group is privately held by members of the Louis Dreyfus family.

Controlling shareholder Margarita Louis-Dreyfus is due to increase her stake after minorities triggered a sale option two years ago, and the matter is heading for arbitration after the parties agreed to end court proceedings, according to sources familiar with the matter.

Reporting by Simon Jessop and Maiya Keidan in London and Gus Trompiz in Paris; Editing by Carolyn Cohn and Mark Potter.


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