GrainCorp wins bid to cut oversight as competition grows
SYDNEY, April 10
SYDNEY, April 10 (Reuters) - Australia's regulatory watchdog will reduce regulation at one of GrainCorp's grain terminals after competition was boosted by new rivals, likely fuelling speculation of a renewed bid for the company.
The Australian Competition and Consumer Commission (ACCC) said on Thursday that new rivals meant GrainCorp's terminal at Newcastle in New South Wales state, one of eight the company runs, was now operating at a disadvantage.
The Australian government last November rejected a A$2.8 billion ($2.6 billion) bid for GrainCorp by Archer Daniels Midland Co, citing a lack of competition for the company's east coast grain handing operations.
Since the rejection, rivals have been targetting GrainCorp's business and recent comments by a government minister that "there may be another opportunity at some stage" for ADM to pursue GrainCorp have prompted analysts to suggest a deal could be revisited.
The ACCC's decision to lighten regulation governing access to users follows the opening of the Newcastle Agri Terminal, backed by Western Australian grain exporter CBH Group and commodity trader Glencore Xstrata.
GrainCorp spokesman Angus Trigg welcomed the move, but said many of the company's ports were still constrained by regulations that did not apply to rivals.
"Where there is regulation, it is critical that there is a level playing field," he said.
A consortium of grain handlers has announced plans to build a new terminal at Port Kembla in New South Wales state, near GrainCorp's largest east coast terminal.
The decision meant GrainCorp may also apply to the ACCC to have regulation reduced at its Port Kembla terminal, a source told Reuters.
($1 = 1.0692 Australian Dollars) (Reporting by Colin Packham; Editing by Richard Pullin)