October 23, 2008

Australia's AWB finalises restructuring of new constitution

Australian agribusiness and former wheat export monopoly holder AWB Ltd has completed a restructuring designed to strengthen its grain marketing business.

AWB, Australia's largest grain marketer, said on Wednesday shareholders had approved a new constitution as the final step in a restructuring sparked by the deregulation of Australia's grain industry.

The government opened Australia's wheat export market to competition from July 1, after AWB was stripped of its monopoly following an inquiry which found it made illicit payments to Iraq's former government of Saddam Hussein to win sales.

AWB now competes with 16 other groups licensed to bulk export Australian wheat, including US commodities giant Cargill Group and Australian listed bulk handlers ABB Grain Ltd and GrainCorp Ltd.

Under the new constitution, AWB must remain a grain marketer, though it can move into other businesses. A rule that prevents any single shareholder from owning more than 10 percent in AWB was also introduced, while at least two directors on the nine-member board must have agricultural backgrounds.

Retiring Chairman Brendan Stewart was replaced by Peter Polson, a former Commonwealth Bank of Australia Ltd executive, who became an AWB director in March 2003.