VITERRA INC. $10.09 (Toronto symbol VT; TSINetwork Rating: Average) (1-866-569-4411; www.viterra.ca; Shares outstanding: 371.7 million; Market cap: $3.8 billion; Dividend yield: 1.5%) is a Saskatchewan-based agribusiness that mainly operates in Canada and Australia. The company accumulates, stores, transports, processes and markets grains, oilseeds and specialty crops including lentils and mustard.

Saskatchewan Wheat Pool was a farmers co-operative until it became a public company in 1996. It changed its name to Viterra in 2007 after it bought Agricore United for $1.3 billion. In 2009, Viterra bought Australian grain handler ABB Grain for $1.4 billion.

In its 2011 fiscal year, which ended October 31, 2011, Viterra’s revenue jumped 42.8%, to $11.8 billion from $8.2 billion. Earnings per share rose 82.1%, to $0.71 from $0.39. Higher crop shipments and grain prices were the main reasons for the gains.

Viterra should benefit from an expected rise in Canadian and Australian crop yields in 2012, as well as the end of the Canadian Wheat Board’s monopoly on western Canadian wheat and barley sales. In addition. its Australian operations’ sales to Asia continue to rise.

The company’s growth and profitability depends on crop conditions and harvests, which vary from year to year. However, global food production and consumption is rising. Canadian and Australian products, with their reputation for quality and safety, will benefit.

Viterra trades at 14.0 times this year’s forecast earnings of $0.72 a share. The company just raised its dividend by 50%, and now yields 1.5%. We never recommend a stock just for its takeover prospects. But acquiring Viterra might be of interest to a global food giant such as Archer Daniels Midland, Bunge or ConAgra.

Viterra is a buy.