Australia’s Federal Court has turned down a bid by local conglomerate CSR Ltd to demerge its sugar business.
In a statement to the Australian stock exchange today (3 February), CSR said the court had “declined to make the orders” sought by the company.
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The court rejected the plan over concerns over CSR’s asbestos liabilities. Its judgement claimed CSR would not be able to meet its liabilities if it demerged its sugar arm.
CSR said the ruling would have “broad implications” and that it would review the judgement and make a further announcement in due course.
The company said it would “responsibly meet” its asbestos claims and reiterated its desire to demerge the sugar unit.
“The board of CSR believes the strategy of separating its two very different operating businesses has the potential to create additional shareholder value,” it added.
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By GlobalDataChina’s Bright Food Group has approached CSR to buy the sugar business but the Australian group has stated it prefers a demerger.
