ADM edges closer to A$3.4bn GrainCorp takeover
GrainCorp’s Board of Directors said it intends to unanimously recommend the proposal providing no superior offer comes forward.
“GrainCorp will work with ADM to ensure that ADM’s confirmatory due diligence requirements can be satisfied, following which a takeover offer would be made on the terms agreed,” said GrainCorp chairman Don Taylor.
“Assuming this is achieved, the GrainCorp Board of Directors intends to unanimously recommend the ADM offer subject to there being no superior proposal, an independent expert determining that the ADM offer is fair and reasonable and the relevant regulatory approvals being satisfied or waived by 31 December 2013,” Taylor added.
Third and final offer?
The latest move from ADM comes after two previous bids were rejected late last year for undervaluing the firm.
The US crop processor made its first proposal of A$11.75 ($12.14) per share in October 2012 and a slightly higher second bid of A$12.20 ($12.60) per share in December.
ADM’s latest proposal is A$13.20 per share – comprised of a cash payment (A$12.20) and dividends totalling A$1 per share.
This offer is 49% up on the closing share price on October 18 2012 of GrainCorp, valued at A$8.85 per share.
Its due diligence on GrainCorp will be conducted between April 25 and May 2. ADM can submit a full takeover bid before or on the last day.
GrainCorp has agreed not to solicit, invite or initiate any competing bids and is required to give ADM two days to match any higher proposal.
ADM Asian strategy
“Should the offer proceed, the addition of GrainCorp to our global network would fit our strategy and help to further connect Australia’s growers with growing global demand for crops and food, particularly in Asia and the Middle East,” said chairman and CEO of ADM Patricia Woertz.
“ADM and GrainCorp have complementary geographies with little overlap and highly compatible cultures."