SYDNEY Japanese Sumitomo Corp (8053.T) has acquired full ownership of Emerald Grain, the Australian bulk grain handler said on Thursday, the latest foray by a foreign entity into the Australian agricultural sector.
Sumitomo Corp previously owned 50 percent of Emerald Grain, but took full ownership through its purchase of its partner in the Australian grain handler, Emerald Agribusiness Group Pty.
Financial details of the deal were not disclosed.
Australia's agribusiness sector has seen a wave of foreign interest, causing some political tension. Australia in November rejected a A$2.8 billion ($2.5 billion) takeover of GrainCorp (GNC.AX) by U.S. agribusiness giant Archer Daniels Midland (ADM.N), bowing to pressure from grain growers in a rare and surprising decision.
Emerald Grain said the Foreign Investment Review Board and the Australian Consumers and Competition Commission were consulted on the deal and had advised the parties that no further oversight would be undertaken.
Alan Winney, chairman of Emerald Grain and of Emerald Agribusiness Group Pty, said in an emailed statement that the deal would allow the bulk grain handler access to "significant capital" to fund growth.
"As a 100 percent subsidiary of Sumitomo Corp the company will be able to fund future growth and expansion and compete more effectively in an Australian and Asian grain market that is now heavily influenced by global companies," Winney said.
Emerald Grain handles about 4.5 million tonnes of grain a year, trailing bigger players like GrainCorp (GNC.AX), Cargill CARGIL.UL and CBH Group, Australia's largest bulk grain handler.
($1 = 1.1214 Australian dollars)
(Reporting by Colin Packham; Editing by Matt Driskill)