Louis Dreyfus Chooses a CEO

By Neena Rai 

Agricultural trading giant Louis Dreyfus Commodities BV said it has appointed Mayo Schmidt as chief executive officer, ending a year-and-a-half-long search.

The choice of Mr. Schmidt, an outsider who spent most of his career in the U.S. and Canada, marks a change for the closely held family company, which has traditionally promoted staff internally. The move, disclosed Friday, has also fed industry speculation that Louis Dreyfus is preparing itself for an eventual public offering.

Earlier this year, Louis Dreyfus added supervisory-board members from outside the company. Margarita Louis-Dreyfus, chairwoman of the holding company that controls Louis Dreyfus, has said in company filings that it is aligning the "business model and operations more closely with those of a publicly listed company," while maintaining a family spirit.

"Everyone knows that they are preparing for an IPO one day and have been trying to find merger partners for some time," said a London-based grains broker.

Mr. Schmidt spent 12 years as president and CEO of Viterra Inc., a Canada-based global food-ingredients company, and has also worked for the U.S.'s ConAgra Foods Inc. Mr. Schmidt left Viterra in 2012, the year it was bought by commodities giant Glencore.

"He did a good job with Viterra," said Charlie Sernatinger, head of grains trading at ED&F Man Capital Markets in Chicago. "Essentially, he took two bankrupt cooperatives and made them private, floated the stock and then sold the company to Glencore."

Louis Dreyfus and its competitors Archer Daniels Midland Co., Bunge Ltd. and Cargill are known in the agriculture industry as the "ABCD" group, who together lead the trading of agricultural commodities. The firm is is among the top global merchandisers of cotton, sugar, rice and citrus fruits.

Between 2006 and 2013, Louis Dreyfus's revenue quadrupled. The company has said it wishes to double its revenue over the next four years.

In September, Louis Dreyfus reported that earnings in the first half of 2014 rose to $260 million from $258 million in the first half of 2013. Revenue jumped 16%, to $33.7 billion, following bumper grain harvests.

Mr. Schmidt, who succeeds interim CEO Claude Ehlinger, will start work in January. Mr. Ehlinger will remain in his existing role of chief financial officer and will also become deputy CEO, the company said a statement.

Sarah Kent and Jacob Bunge contributed to this article.

Write to Neena Rai at [e-mail]

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