Archer Daniels Midland is set to table an offer for GrainCorp after completing an agreed period of due diligence on the Australian grain trader.

The US agribusiness giant said yesterday (1 May) it would offer A$12.20 under the terms of a deal struck with GrainCorp last week.

As part of the agreement, GrainCorp will also pay its shareholders a special dividend of A$1 a share.

The deal brought an end to months of warngling between the two sides. In October, ADM bid A$11.75 a share for GrainCorp, which turned down the offer after saying it under-valued the company. ADM, which acquired shares in GrainCorp that equated to 19.9% of the business, upped its bid again to A$12.50 a share but the higher bid was again rejected.

GrainCorp's board has indicated it would unanimously recommened ADM's latest offer subject to an independent expert judging the bid is fair and to regulatory conditions being satisified.

ADM said yesterday the transaction would be "earnings accretive in the first full year". Chairman and CEO Patricia Woertz added: "We believe the offer delivers strong value for both companies’ shareholders. With the world’s population growing by half a billion people every decade, and with rising incomes driving increased consumption of grains and protein, global demand for agricultural products will continue to see significant growth. GrainCorp provides an excellent platform to serve that growth, particularly in fast-growing markets in the Middle East, Africa and Asia."

Meanwhile, ADM also yesterday reported its results for the first quarter. It said net profit attributable to ADM shareholders fell to US$269m, down from $399m last year. First-quarter PBT dropped to $375m from $568m. The bottom line was hit by higher SG&A expenses and higher cost of goods sold.

During the quarter, sales rose to $21.7bn from $21.1bn in the first quarter of last year.