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m 19 u\j onni^wit FoREÎqN FÍRIVIS u(ÎTh INVESTMENTS ÍN ThE U.S. Food ANd FibER SySTEM ^—j ^p j>l— oo m Economie Research Service U.S. Department of Agriculture Agricultural Economie Report No. 302 FOREIGN FIRMS WITH INVESTMENTS IN THE U.S. FOOD AND FIBER SYSTEM. By Kenneth R. Krause. Economic Research Service, U.S. Department of Agriculture. Ai>ricultural Economic Report No. 302. ABSTRACT This report contains names of foreign parent companies believed to be involved in the U.S. food and fiber system, names and addresses of their U.S. subsidiaries, and an in- dication of the oroducts they handle. Countries of origin and U.S. addresses are given. Since foreign direct investment in U.S. farming and the food and fiber system is of very recent interest, the list of firms is not exhaustive but provides a basic point of depar- ture for study of the topic. KeyvTords: Foreign direct investment, agriculture, food system, directory. PREFACE Foreign investment in U.S. farming and the food and fiber system is attracting in- creasing interest and concern. This report lists foreign parent firms and U.S. subsid- iaries thought to be involved in such activities in the United States. The list is based primarily on published sources. Extensive effort was made to exhaust possible public sources of names through contact with about 300 people and in- stitutions. Although these sources are fairly recent, some firms may have changed. The list is undoubtedly not complete, since U.S.-based firms with foreign ownership are not required to register or report their alien ownership to either State or Federal Governments. An exception is Federal income tax reporting, but such individual reports are not public information. This report is primarily for the use of researchers. Private and public decision- makers may also find the material of use. The material can serve as a reference for work on foreign firms with U.S. subsidiaries. We welcome further information about the firms listed, other firms that should be included, or the financial and operational characteristics of such firms. The author is indebted to the numerous firms and individuals who contributed to this report. Bob Atkins and Tom Pierpoint, U.S. Department of Commerce, were particu- larly helpful in providing information on published sources. COOTENTS Page Introduction , i Sources of Information 3 Compilation of the Directory 4 Future Information Sources 10 Directory of Foreign Investors, by Country 11 Appendix A--General Reference Sources of Foreign Firms with U.S. Subsidiaries.. 96 Appendix B--Specific Information Sources on Foreign Firms with U.S. Subsidiaries, by Country gg Appendix C--Information Sources Surveyed for Countries with No U.S. Subsidiaries 102 Washington, D.C. 20250 November 1975 FoREÎqN FÍRIVIS wÍTh INVESTMENTS ¡N ThE U.S. Food ANd FibER SySTEM by KENNETh R. KRAUSE^ INTRODUCTION Foreign investment in the United States is attracting increasing interest. Concern has been heightened by the devaluation of the dollar against other currencies and by the large amount of dollars owned by several foreign governments, nonresident aliens, and foreign firms which may be seeking investment outlets, Paurt of the chcuige in who holds investable dollars is associated with the large increase in oil prices by the Organization of Petroleum Exporting Countries and the extra dollars some of those countries are accumulating. Foreign investors recognize that the United States has one of the more stcÜDle economies in which to invest. They may also have the desire and capacity to improve their standard of living through purchase cuid transport of U.S. goods and services, or through direct investment in the production, processing, and distribution of U.S. goods and services. The U.S. food and fiber system has received particular attention in the past 2 years, as foreign countries have sought to increase their imports of raw or processed agricultural commodities. In some cases, they may be attempting to guarantee a supply of U.S.-produced agricultural commodities through investments in production or processing. Other foreign firms and foreign governments may have particular production, processing, marketing, or business technology that is unique or competitive in one or more subsectors of the U.S. food and fiber system or the beverage industry. Since World War II, the policy of the U.S. Government has primarily been to help foreign countries develop through Federal and private sector aid and investment. Thus, the current shift to interest in foreign investment in the United States finds us with an inadequate identification of the nature. 1/ Agricultural Economist^Structure and Adjustments Program Area, National Economic Analysis Division, Economic Research Service. extent, and rate of chamge of such activity. Further, more is known about foreign investment in other sectors of the economy than in the food and fiber system. Direct foreign-investment in all sectors of the U.S. economy apparently accounts for only about 1 percent of the total dollar value of domestic assets.2/ No specific data are available for the food and fiber system cuid, consequently, no estimates have been made of the magnitude of foreign investment in this sector. Foreign investment in the United States is generally either direct or portfolio, although the distinction is somewhat arbitrary. Direct investment generailly means full or sufficient ownership by a nonresident alien, corporation, or government to control the U.S. firm. Portfolio investment generally meems some foreign ownership, but not enough for effective control of management decisionmaking, at least in the hands of one foreign entity. Portfolio investment sometimes refers to investment through trusts, financial holding companies, cUid other indirect means. A subsidiary company, for purposes of this report, is one in which foreigners have sufficient ownership, to exercise partial or complete control. In many cases, the U.S. subsidiaries were probably established by U.S. firms, but subsequently acquired by cUid now controlled by the foreign parent firm. Some of the Americcm subsidiaries are jointly owned by two or more foreign parent companies from the same or different countires, or owned by a parent company listed as headquartered in one country but in reality owned by foreign citizens or companies in still another country. Some U.S. subsidiaries are joint ventures with U.S.-owned firms, or are primarily U.S.- owned but continue relations with the foreign parent through contractual arrcuigements which may or may not provide effective foreign control. Some subsidiaries are legal branches of the foreign parent, while other are incorporated in the United States, either in the State where they operate or in cuiother State. Some foreign owners may have full equity in the subsidiary, while others using credit and other forms of financing may have little equity. In some cases, the U.S. subsidiary is listed and shares of its stock traded on the U.S. stock exchanges or in over-the-co\inter markets. This report provides a start toward identifying foreign direct investors in the U.S. food and fiber system.3/ Data on the magnitude of such investment are expected to be developed under the Foreign Investment Study Act of 1974 and pijblished during the coming year. Such data will be for groups of firms. 2/ Survey of Current Business, U.S. Dept. of Commerce, Sept. 1973. 3/ For a more extensive discussion of foreign investment issues and problems in U.S. agriculture and the food system see: a. Fernstrom, John R., "Foreign Investment in U.S. Business and Industry," Ext. Serv., U.S. Dept. Agr., ID-40, Mar. 1974. b. Krause, Kenneth R., and William H. Scofield, "Foreign Investment in U.S. Agriculture and the Food System," U.S. House of Representatives, Subcommittee on Foreign Economic Policy, Govt. Printing Office, Washington, D.C., Feb. 7, 1974. c. Krause, Kenneth R., and Williaun Scofield, "Foreign Investment in U.S. Agriculture and the Food System. The Need for and Methods of Obtaining Data aind Analysis," U.S. Senate Subcommittee on Foreign Commerce amd Tourism, Govt. Printing Office, Washington, D.C., Mar. 7, 1974. 2 SOURCES OP INFORMATION Efforts to develop pxablic lists of foreign direct investors in the United States apparently began less than a decade ago and have not been extensive.4/ The majority of the effort focused on U.S.-based subsidiaries involved in "" manufacturing and petroleum activities. No systematic effort has been made to develop such a list of investors in the food and fiber system. Information about firms in this report, for the most part, was obtained from published sources. None of the sources claim complete coverage. These sQurces were generally based on published reports, newspapers, magcuzines, ttade contacts, and chambers of commerce. Few of them attempted to verify the information with the listed firms. Since there is a lag time in compiling lists, the sources were at least a year old. The published sources listed many firms with products or services outside the food and fiber system, and some listed several different U.S. subsidiaries for foreign companies. Only the subsidiaries with food and fiber system activities are included in this report. Some firms engaging in food and fiber system activities but with primary interests in other areeis may not have been identified here, because evidence of their involvement in the food and fiber system could not be established. Finemcial firms, such as bemks and insurance conç)anies, were generally not included in the published sources. Since the subsidiaries were not contacted directly, they were not classified by Standard Industrial Codes. No confirmation was made of the addresses or of the firm names, products, or services. The food and fiber system wais defined in the broadest possible terms. It included firms engaged in such diverse activities as selling calf feeders, operating grain elevators, and manufacturing fertilizer, food processing machinery, and candy.

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