Bunge & Born was founded in 1883 by Ernesto Bunge, a
German Argentine whose uncle, Karl Bunge, had been Consul General in Argentina for both the
Netherlands and
Prussia, and his brother-in-law, Jorge Born, who had recently arrived from
Antwerp. The company superseded the Bunge Company founded in
Amsterdam by Johan Bunge, in 1817. Following the purchase of of prime
pampas wheat fields, Bunge & Born established
Centenera, their first food processing plant, in 1898. They had one of the largest wheat mills in the country built on a
Puerto Madero lot in 1901, and with it, established
Molinos Río de la Plata (later a leader in the local retail foods market). The company started Argentina's first
burlap bag manufacturer, following which they successfully lobbied government policy makers for
protective tariffs on the then-critical commercial staple. They established a mortgage bank, the
Banco Hipotecario Franco Argentino, and a subsidiary in
Brazil in 1904, and by 1911, they reportedly controlled 79% of Argentine cereal exports (Argentina was, by then, the world's third-largest grain exporter). They later established paint manufacturer
Alba (1925), chemical and fertilizer maker
Compañía Química, and textile maker
Grafa (1932), among others; by the late 1920s, the company's annual export receipts alone reached US$300 million. The company inaugurated its
neo-Gothic Buenos Aires headquarters on
Leandro Alem Avenue, designed by local architect Pablo Naeff, in 1926. Bunge & Born's near-monopoly on cereal and flour exports ended with populist President
Juan Perón's 1946 establishment of the
IAPI, a state agricultural purchasing and export agent. The company responded by extending its reach into the country fast-growing retail processed foods market, and though its prominence as the nation's chief exporter was partly restored by Perón's 1955 ousting and the IAPI's liquidation, its focus remained domestic over the next three decades. A privately held company, Bunge & Born did not release periodical financial statements, though it did report US$2bn in gross receipts in 1962; by then it had become an agribusiness leader, operating 110 offices worldwide. The Bunge, Born, Hirsch, Engels and De La Tour families remained the company's chief stockholders, and by extension, leaders in the domestic textile, paint, chemical, fertilizer, and food processing industries. On September 19, 1974, however, the consortium was shaken by the kidnapping of siblings Jorge and Juan Born by the far-left terrorist group,
Montoneros. Freed for a US$60 million ransom (the largest on record at that time), the ordeal triggered the company headquarters' relocation to
São Paulo, Brazil, and contributed to the
March 1976 coup. Retaining their Argentine interests (44 companies, by the 1980s), the families continued to suffer from ongoing disputes, and in 1988, CEO Mario Hirsch died from tripping. The election of
Carlos Menem to the Argentine Presidency in May 1989, however, resulted in an agreement between the President-elect and Jorge Born that gave the company partial control over national economic policy. Bunge & Born provided the Menem government with its first two economy ministers, and the combination of large rate increases on public services (around 500%), a simplified exchange rate and a massive, mandatory wage hike led to a sharp economic turnaround between July and November 1989. This foray into government policy making, however, ended in a new currency crisis that December and the failure (compounded by the company's lackluster business performance) resulted in Born's 1991 ouster from the board; he was replaced by Chief Operations Officer
Octavio Caraballo. Beset by the rift between Jorge Born and his brother, Juan, the prior unity between the shareholders disintegrated as Caraballo struggled to modernize the company. Family frictions intensified when Jorge Born formed a business partnership with one of his former kidnappers, erstwhile Montonero strategist
Rodolfo Galimberti. ==Bunge International==