Blog: Hannah AbdullaADM looks to up stake in GrainCorp following bid block

Hannah Abdulla | 2 April 2014

ADM is looking to grow its stake in the GrainCorp business

ADM is looking to grow its stake in the GrainCorp business

Archer Daniels Midland is looking to up its stake in GrainCorp after Australia blocked its proposed A$3.4bn (US$3.09bn) takeover bid at the end of last year after worries the move was "not in the national interest".

The firm which holds a 19.85% stake in GrainCorp is now looking grow its share allowing it to increase its presence outside of the US. Australia is of interest as it is one od the world's top wheat exporting countries.

Joe Hockey, Australia's Federal Treasurer, said he was "inclined" to approve any attempt by ADM to take its shareholding up to 24.9% "to encourage ADM to demonstrate its commitment to the Australian grains industry".

In a report carried by the Financial Times today (2 April) ADM president and chief operating officer Juan Luciano said: "We're going to hold to our 20% and we're going to try to increase that, to get to the final goal."

But last year, ADM's pursuit of GrainCorp had met with opposition in some political and farming circles with federal MPs claiming the deal would put "one of Australia's greatest industries" in "jeopardy".

"The proposed sale of GrainCorp to ADM must not be allowed to proceed," said The Independent Member for Denison, Andrew Wilkie. "The foreign acquisition might well bolster GrainCorp, but more likely is that GrainCorp and many Australian farmers would become pawns in ADM's domination of the global grain market.

Talking of the halted takeover and plans to up its stake in Graincorp Luciano told FT: "It's the last Australian asset in the east, and as I said we were slammed by a little bit of fear and nostalgia. We are committed to working with the government and the farmers to placate those fears and dissipate those fears.

Earlier today Chinese state-owned agribusiness and food group COFCO announced it is to set up a commodity venture with Singapore conglomerate Noble Group which will see it take a 51% stake in the Noble Agri venture with Noble Group retaining 49%



Sainsbury's pulls the price lever

Sainsbury's, the UK's second-largest grocer, has set out plans for lower prices on a range of products, a move announced amid signs of pressure on its market share....


Intermarche broke rules with Nutella promo, French watchdog says

The pandemonium in stores of Intermarché as shoppers scrambled to grab jars of cut-price Nutella went viral - but the country's competition watchdog has announced the French retailer broke rules on se...


Big Food in investor spotlight this week at CAGNY

The senior management of a number of the major food manufacturers operating in the US will be in Florida this week for a key date on investor calendars....

Forgot your password?