ADM makes new proposal for GrainCorp shares

GrainCorp has received a revised non-binding proposal from US company Archer Daniels Midland (ADM) to acquire GrainCorp’s outstanding shares. The US commodities giant made a takeover offer to acquire the outstanding shares in GrainCorp for $12.20 per share in cash.

ADM had made an initial proposal of $11.75 in October but has increased its offer by 80 cents. The new proposal is subject to due diligence, exclusivity, regulatory approvals and approval by the ADM Board.

ADM has now accumulated an economic interest in 19.9% of GrainCorp shares, after acquiring an additional 5% of GrainCorp’s shares on 3 December for $12.20 per share. ADM has received approval from the Australian Foreign Investment Review Board to acquire up to 19.9% of the shares in GrainCorp.

“We consider that our revised non-binding proposal reflects the value of GrainCorp’s business, taking into account GrainCorp’s 2012 results, its new initiatives announced on November 15, and its recently announced ordinary and special dividends totalling AU$0.35,” said ADM Chair and CEO Patricia Woertz.

“Our proposal also offers more certainty, greater value and immediate realisation of potential future value for GrainCorp shareholders than GrainCorp’s standalone plan.

“ADM is a disciplined buyer, and any combination with GrainCorp must meet our key financial hurdles, taking into consideration the impact of the Australian agricultural cycle on GrainCorp’s earnings power.”