October 4, 2013 / 8:22 AM / in 4 years

UPDATE 1-Australia extends time for decision on ADM acquisition of Graincorp

CANBERRA, Oct 4 (Reuters) - Australian Treasurer Joe Hockey on Friday extended the time period for a foreign investment decision on Archer Daniels Midland Co’s acquisition of Australian grain handler GrainCorp Ltd, which is now due by Dec. 17.

The A$3.0 billion ($2.8 billion) deal will be the first major decision of the Foreign Investment Review Board (FIRB) and for Hockey since the election of Australia’s new conservative government on Sept. 7.

“Given the size of this transaction and the complex nature of the issues involved, I have decided to extend the statutory time period. This will allow sufficient time for the new government to carefully consider all the relevant issues and advice from the Foreign Investment Review Board before making a decision,” Hockey said.

The new time frame is consistent with ADM’s expectations of completing the transaction by the end of the year, and would give the FIRB time to negotiate any conditions it might require on the deal.

The FIRB looks into whether any investments by foreign entities are against Australia’s national interest, but Hockey will have the final decision.

Hockey and new Prime Minister Tony Abbott have declared Australia to be open for business since they won power, despite concerns from the coalition government’s junior partner, the rural-based National Party, over the ADM-Graincorp deal.

National Party leader Warren Truss, who is now deputy prime minister, has called on Hockey to reject the acquisition and grain growers in three Australian states have expressed concerns over the sale.

ADM’s planned purchase of GrainCorp, announced in April, is the latest move in the rapid consolidation of the global grains sector amid intense competition to feed fast-developing countries like China.

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