GrainCorp to buy United Malt Holdings For A$757M

Agribusiness GrainCorp Ltd. on Tuesday said it will buy United Malt Holdings, the world's fourth largest commercial malt producer, for A$757 million (US$663.7 million).

GrainCorp said the agreed purchase from CHAMP Private Equity and Castle Harlan Inc. will transform it into an international agribusiness with operations in Australia, the U.S., Canada and the UK.

GrainCorp plans to fund the purchase through a A$489 million entitlement offer, a A$100 million institutional placement and it also plans to raise US$200 million in debt, it said in a statement.

GrainCorp also upgraded its net profit guidance for last fiscal year ended September 30 to a range A$60 million-A$63 million from a previous range of A$53 million-A$63 million.

The company will pay a 15 cent final dividend.

In addition, GrainCorp has called a trading halt on its shares until Friday so it can announce an acquisition and associated capital raising.

It also wants the trading halt "to allow the institutional component and placement component of the capital raising to take place in an orderly fashion", the company said in a statement.

US$1 = A$1.14068 (Oct 6)