Dec 3 Archer Daniels Midland Co on
Monday raised its bid for Australia's GrainCorp Ltd to
$2.9 billion in cash from $2.8 billion, as the U.S. agribusiness
group seeks to expand its geographic reach.
ADM is now offering A$12.20 ($12.73) per share in cash, up
from its prior bid of A$11.75. Including a recently announced
dividend of 35 cents per share, which GrainCorp shareholders
would be able to keep, ADM said its new offer is for A$12.55 per
ADM said the new proposal reflected the value of GrainCorp's
business, taking into account its 2012 results, new initiatives
and dividends announced on Nov. 15.
ADM said it acquired an additional 5 percent of GrainCorp
for the new offer price, raising its stake to 19.9 percent.
The offer comes at a time of dramatic consolidation in the
global grains sector amid intense competition to feed
fast-developing countries seeking food security. GrainCorp is
the last available independent asset of scale in Australia,
which is an attractive market due to stable policies and good
links to Asia.
GrainCorp rejected ADM's earlier bid, which valued the
company at $2.8 billion, saying it undervalued GrainCorp after a
bumper harvest delivered a record annual net profit. At the
time, analysts and shareholders said they expected a higher
offer, or offers from rivals.
ADM said its offer was subject to due diligence, which it is
ready to begin immediately.
ADM Chief Executive Patricia Woertz said the bid offered
more certainty, greater value and immediate returns than
GrainCorp's standalone plan.
A GrainCorp spokesman was not immediately available to
The company's shares closed at A$11.94 in Sydney, up 0.3
percent. ADM shares were unchanged in New York premarket trade.