July 15, 2013

South Africa clears ADM's acquisition of Graincorp

South Africa's Competition Commission has cleared Archer Daniels Midland Company's (ADM) proposed acquisition of Australian grain handler and processor Graincorp.

In April, ADM entered into an agreement to acquire Graincorp in a deal worth AUD2.8 billion (US$2.57 billion). ADM agreed to pay AUD12.20 (US$11.23) per share in cash to acquire GrainCorp.

The approval by South Africa's Competition Commission brings the number of government agencies that have cleared the acquisition to four.

Canada's Competition Bureau cleared the acquisition last week, while the Australian Competition and Consumer Commission did so in June. The US Federal Trade Commission also approved the acquisition last November.

ADM noted that it is working with regulators in Australia, China, the EU, Japan and South Korea to gain approval for the acquisition.

The acquisition by ADM is part of its strategy to strengthen its agricultural services and oilseeds businesses by investing in key supply regions outside the US.

GrainCorp, based in Sydney, Australia, is involved in the receival, testing, transport, handling and storage of grain and other bulk commodities, as well as the exportation of wheat, barley and oilseeds, with a presence in North America, Europe, Australia, Africa, Asia and South America.