SYDNEY--(BUSINESS WIRE)--Archer Daniels Midland Company (NYSE: ADM) announced today that it has
signed a takeover bid implementation deed with GrainCorp Limited (ASX:
GNC) and begun due diligence on GrainCorp. Subject to the satisfactory
completion of this due diligence, ADM has agreed to make a cash offer,
which would be unanimously recommended by the GrainCorp board, to
acquire the company for A$12.20 per share (the “potential offer”). Under
the terms of the bid implementation deed, GrainCorp will pay to its
shareholders dividends out of current and retained earnings of the
business prior to the transaction close.
“We are pleased to have reached agreement with GrainCorp to conduct due
diligence and, subject to that due diligence, put a recommended offer
before GrainCorp’s shareholders,” said ADM Chairman and CEO Patricia
Woertz. “We anticipate that the offer will be cash accretive in the
first full year and will meet our key financial objectives.
“GrainCorp is a leader in the Australian agribusiness sector. Should the
offer proceed, the addition of GrainCorp to our global network would fit
our strategy and help to further connect Australia’s growers with
growing global demand for crops and food, particularly in Asia and the
Middle East. ADM and GrainCorp have complementary geographies with
little overlap and highly compatible cultures. We look forward to
working with the GrainCorp team and Australian growers to build on their
history of success.”
The agreement permits ADM to undertake due diligence on GrainCorp for a
seven-day period. Subject to the satisfactory completion of this due
diligence, ADM will announce whether the potential offer will proceed or
the agreement will be terminated. The announcement will occur prior to
the completion of ADM’s first-quarter earnings call, which has been
rescheduled to begin May 1, 2013, at 5 p.m. Central U.S. Time (May 2,
2013, at 8 a.m. Australian Eastern Standard Time).
Should the potential offer proceed, ADM would announce a takeover bid to
GrainCorp shareholders. GrainCorp has advised that such an offer would
be unanimously recommended by the GrainCorp board, subject to there
being no superior proposal, an independent expert confirming that the
offer is fair and reasonable, and the regulatory conditions for the
acquisition being satisfied or waived by Dec. 31, 2013.
If the potential offer proceeds, GrainCorp would pay to its
shareholders, prior to the completion of the transaction, dividends
totaling A$1.00 per share. If the regulatory conditions are not achieved
by Oct. 1, 2013, GrainCorp will pay an additional dividend of A3.5 cents
per share for each full month between Oct. 1, 2013, and the satisfaction
or waiver of the regulatory conditions, subject to GrainCorp being
profitable over that period.
The potential offer would imply an aggregate transaction value of A$3.4
billion, including GrainCorp’s net debt. The transaction value reflects
the weighted average cost of acquiring the initial 19.8 percent stake in
GrainCorp at an average of A$11.24 per share and the outstanding shares
of GrainCorp at A$12.20 per share. The transaction is expected to be
cash accretive in the first full year and to meet ADM’s key financial
objectives. Following successful completion of the due diligence
process, ADM would provide additional details.
The offer would be subject to the conditions set out in the takeover bid
implementation deed, viewable at www.adm.com,
which include that ADM receives minimum acceptances of 50.1 percent. ADM
presently owns 19.8 percent of GrainCorp’s shares.
Barclays and Citi are acting as financial advisors. Corrs Chambers
Westgarth and Cravath, Swaine & Moore LLP are acting as legal advisors.
This news release includes forward-looking statements, within the
meaning of the Private Securities Litigation Reform Act of 1995, that
are subject to risks, uncertainties and other factors, including,
without limitation, with respect to any potential acquisition by ADM of
all or any portion of GrainCorp. There can be no certainty that any
discussions will result in a transaction or the entry into a definitive
agreement. These risks, uncertainties and other factors could cause
actual results to differ materially from those referred to in the
forward-looking statements. The reader is cautioned not to rely on these
forward-looking statements. Other risks are described in detail in the
ADM Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2012,
as filed with the U.S. Securities and Exchange Commission. All
forward-looking statements are based on information currently available
to ADM, and ADM assumes no obligation to update any such forward-looking
The potential offer described herein has not yet been announced or
commenced, and this material is neither an offer to purchase nor a
solicitation of an offer to sell shares of GrainCorp. If the offer
described herein is announced or commenced, ADM will in due course file
a Bidder’s Statement, and GrainCorp will file a Target’s Statement with
the Australian Securities Exchange (the “ASX”).
For more than a century, the people of Archer Daniels Midland Company
(NYSE: ADM) have transformed crops into products that serve vital needs.
Today, 30,000 ADM employees around the globe convert oilseeds, corn,
wheat and cocoa into products for food, animal feed, industrial and
energy uses. 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. For
more information about ADM and its products, visit www.adm.com.
GrainCorp is Australia’s leading agribusiness, with integrated
“end-to-end” grain handling and processing infrastructure in Australia
and overseas. By connecting local and global consumers to grain growers,
GrainCorp plays an important role in the grain supply chain for the
supply of wheat and flour, barley and malt and canola and edible oils.
Handles ~75 percent of eastern Australia’s annual grain production
through direct receivals at either country sites or port terminals;
Handles ~90 percent of eastern Australia’s bulk grain exports;
Markets ~35 percent of eastern Australia’s grain to overseas consumers
and 25 percent to domestic consumers, and has a growing international
grain marketing platform with a presence in the UK, Europe, Canada and
Produces ~35 percent of Australia’s malt and is the world’s 4th
largest commercial maltster with international operations in Canada,
the USA, the UK and Germany;
Produces ~40 percent of Australia’s crude canola oil and refined
edible oils, and is a leading edible oil refiner in New Zealand;
Imports and exports ~40 percent of Australasia’s edible oil through 12
bulk liquid terminals;
Produces ~35 percent of Australia’s flour (through 60 percent interest
in Allied Mills).
Archer Daniels Midland Company
Ruth Ann Wisener