Australia’s Graincorp Concedes to $3.4B Takeover Bid Offer of U.S.-based Archer Daniels Midland Co
By Esther Tanquintic-Misa | April 26, 2013 1:28 PM EST
GrainCorp Ltd., Australia's largest listed grain trader and the last standing independent grains handler, has conceded to a $3.4 billion takeover bid offer of U.S.-based Archer Daniels Midland Co (ADM).
The company's shares immediately zoomed up 92 cents, or 7.8 per cent, to A$12.79 when trading started at 11am on Friday, marking an all-time high for Graincorp shares. The stock has traded as low as A$8.38 in the past year.
Confirming the development on its Web site on Friday, ADM said it had also begun due diligence on the Australian company.
"Subject to the satisfactory completion of this due diligence, ADM has agreed to make a cash offer, which would be unanimously recommended by the GrainCorp board, to acquire the company for $A12.20 per share," Patricia Woertz, ADM chairman and chief executive, said.
"Under the terms of the bid implementation deed, GrainCorp will pay to its shareholders dividends out of current and retained earnings of the business prior to the transaction close."
ADM has a seven-day period to undertake due diligence on GrainCorp.
This is ADM's third attempt to court Australia's biggest grain handler to yield to a takeover. It first approached GraincCorp in October 2012 with a $2.6 billion bid, or $11.75-per-share, which GrainCorp rejected. A second approach, at $12.20-per-share, worth $2.8 billion, lodged in December was also rebuffed.
"You saw the share price slipping away a week or two ago on the risk that a higher offer wouldn't come through. I don't think this offer will disappoint," Jordan Rodgers, an equities analyst at Commonwealth Bank of Australia, told Reuters.
"The GrainCorp Board believes that the ADM offer highlights the strategic value of our business and unique assets, the program of strategic initiatives being undertaken and GrainCorp's enviable proximity to the fast growing Asian markets," GrainCorp Chairman Don Taylor said in a statement on Friday.
To report problems or to leave feedback about this article, e-mail:
To contact the editor, e-mail:
Most Popular Slideshows
- 2014 MLB World Series Game 1: San Francisco Giants 7, Kansas City Royals 1 [PHOTOS]
- 2014 MLB World Series - Game 2: Kansas City Royals 7, San Francisco Giants 2 [PHOTOS]
- NFL Thursday Recap - Denver Broncos 35, San Diego Chargers 21: Peyton Manning Has 3 TDs In Easy Win [PHOTOS]
- 2014 MLB World Series Game 3: Kansas City Royals 3, San Francisco Giants 2 [PHOTOS]
Join the Conversation
- Australia's Low Birth Rate May Be Due to Low Confidence in Economy
- Fears Of Infection Spread Prompt Some US Hospitals To Refuse Ebola Patients
- Readers Slam a Book Showing That US Wealth And Power Rests on Slave Labour
- LG G Watch R To Be Available Globally Starting With Europe, North America And Asia Through Retail Sites And Play Store
- Young Teen Fighter Says ISIS Uses Drugs On Suicide Bombers To Get Them Perform The Act
- Xiaomi Redmi 1S vs. Sharp Aquos Crystal – Specifications, Features And Price Showdown
- Verizon Motorola Droid Turbo Leaked Live Images Surfaces, Scheduled To Get Unveiled On Oct 28
- Update HTC One M7 with LG G2 with Android 4.4.2 as Sprint OTA: Fixes and Installation
- U.S. Targets Buyers of ISIS Oil, Threatens Sanctions
- ISIS Syria Airstrike Bombing Has Killed 550 People, Civilians Included
- Russia Blocking OSCE Monitoring Of Its Border With Ukraine
- Russia Slams US 'Double Standards' In The Fight Against ISIS