June 24, 2013

 

ADM Australia Holdings II Pty Limited, a wholly owned subsidiary of Archer Daniels Midland Company (ADM) has lodged with the Australian Securities and Investments Commission its Bidder's Statement for an all-cash, off-market takeover offer for GrainCorp Limited today.

 

The GrainCorp Board has unanimously recommended that shareholders accept the offer, in the absence of a superior offer. The GrainCorp Directors believe that the price of GrainCorp shares on the ASX is likely to fall if the Offer is not successful and no superior proposal emerges, at least in the near term.

 

The all-cash offer of AUD12.20 (US$11.24) by ADM, together with illustrative permitted dividends of AUD1.00 (US$0.92) per GrainCorp share by GrainCorp represents a 49% premium to the last closing price of GrainCorp shares of AUD8.85 (US$8.15) on October 18, 2012 – the date of the last undisturbed share price before ADM first approached GrainCorp.

 

The offer also presents a 48% premium to the one-month, volume-weighted average GrainCorp share price of AUD8.90 (US$8.20) up to October 18, 2012; and a 44% premium to the three-month, volume-weighted average GrainCorp share price of AUD9.14 (US$8.42) up to October 18, 2012.

 

"The independent expert has assessed the proposal and concluded that it is fair and reasonable, in the absence of a superior proposal," says ADM Chairman and CEO Patricia Woertz.

 

"We also believe ADM's offer will deliver compelling benefits to Australian growers and the agricultural economy through access to new markets, investment in agricultural infrastructure, and its focus on serving the needs of Australian growers," Woertz added.

 

"Agriculture is an increasingly global business, and Australia is well positioned to take advantage of growing global markets in places like Asia and the Middle East," Woertz said. "Our objective is to help Australia meet that challenge, by giving growers more choice, greater access to global markets, more efficient and effective logistics and a deeper knowledge of market dynamics and best practices."

 

With more than 265 processing plants, 460 crop procurement facilities, and the world's premier crop transportation network, ADM helps connect the harvest to the home in more than 140 countries.

 

The bidder's statement confirms that ADM will continue to operate GrainCorp's port services in accordance with the current open access arrangements and will continue the current access arrangements for upcountry silos; and support or invest AUD300 million in capital expenditure in the GrainCorp business from the execution of the takeover bid implementation deed on April 25, 2013, which includes.

 

ADM will also invest, on average, between AUD40 million and AUD60 million annually over the coming years in the maintenance and improvement of existing infrastructure assets.

 

The offer is scheduled to close at 7.00 pm, Sydney time on August 31, 2013, (unless extended) and is subject to a number of conditions, including 50.1% minimum acceptance (including the 19.85% relevant interest ADM currently holds) and no objection from regulatory bodies.