Veteran of ‘Cocoa War’ Prepares for Succession at Trader Sucden

(Bloomberg) -- The family behind soft-commodity trading house Sucres et Denrees SA has begun a generational transition by shifting more ownership to the grandchildren of the company's founder.

Serge Varsano, who took over running the company known as Sucden after his father Maurice's death and made his name as a trader in the “Cocoa War” of the late 1980s, has passed some of his stake to his sons, according to people familiar with the matter.

A filing this week by Sucden Financial Ltd., the French group's London brokerage subsidiary, stated that Serge Varsano was no longer “a person with significant control.” As Sucden Financial is 100% owned by Paris-based Sucden, that implies a change in the shareholding structure of the parent as well.

Varsano, 66, had recently been transferring shares to his sons as part of a long-planned generational succession, said the people, who asked not to be named as the matter isn't public.

In an email, Varsano said only that “my family shareholding of Sucden has not changed.” Sucden's most recent annual report shows that Serge Varsano owned 18.15% of the company directly, with a further 40.25% owned by a family company at the end of 2020.

The agricultural-commodity trading industry is unusual in the modern business world, in that many of its largest players have remained family-owned for generations. The largest, Cargill Inc., is still owned by the families of its founders, while Louis Dreyfus Co. is still controlled by Margarita Louis-Dreyfus.

However, other historic names in the trading industry are no longer in the hands of their founding families: the Bunge and Born families no longer control Bunge Ltd., which listed in New York in 2001.

Paris-based Sucden has been owned and run by the Varsano family since it was founded by Maurice in 1952 to import sugar into North Africa. Serge took over the running of the company not long after his father died in 1980. Today, one of Serge's sons is a cocoa trader at Sucden, while the other is a trader on the sugar desk, according to people who know them.

Serge made his name in an episode that was dubbed the “Cocoa War” of the 1980s, when the president of top producer Ivory Coast, Felix Houphouet-Boigny, responded to a collapse in prices by imposing an embargo on cocoa sales. After 18 months of stalemate, Varsano convinced the president to sell him 400,000 tons of cocoa, half of which would be stored off the market in Amsterdam in order to prop up prices.

But Houphouet-Boigny also sold cocoa to Varsano's great rival, U.S. trading house Phibro. Eventually, an oversupply of beans meant prices tumbled. Sucden exited the cocoa sector for many years, returning only in 2011 when it hired Varsano's one-time nemesis, the former head of cocoa at Phibro.

Serge Varsano also forged a close relationship with Fidel Castro of Cuba, continuing a connection first established by his father. Sucden was the only European company to have a telex in Havana at the time of the revolution that brought Castro to power in 1959, according to a company history, and was for years the exclusive supplier of Cuban sugar to Japan.