Combined company will create enhanced global partner for growers and customers
DECATUR, Ill. & SYDNEY--(BUSINESS WIRE)--Archer Daniels Midland Company (NYSE: ADM) announced today that it has
completed due diligence on GrainCorp Limited (ASX: GNC) and intends to
make a cash offer to acquire the outstanding common shares of the
company for A$12.20 per share under the terms of the takeover bid
implementation deed signed with GrainCorp last week.
“We believe the offer delivers strong value for both companies’
shareholders,” said ADM Chairman and CEO Patricia Woertz. “The
acquisition fits well with our growth strategy and will meet our return
objectives. We are also confident in the cultural fit of our two
companies: we share similar values of integrity, excellence and safety,
with strong commitments to people, communities, customers and
sustainability.
“With the world’s population growing by half a billion people every
decade, and with rising incomes driving increased consumption of grains
and protein, global demand for agricultural products will continue to
see significant growth. GrainCorp provides an excellent platform to
serve that growth, particularly in fast-growing markets in the Middle
East, Africa and Asia. Together, ADM and GrainCorp will give customers
around the world access to a more diversified origination portfolio
while providing Australian growers with greater access to world markets,
enhanced logistics, and leading market insight.”
The offer implies an aggregate transaction value of about A$3.4 billion.
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 remaining shares of GrainCorp at A$12.20 per share. The
transaction meets ADM’s key financial objectives, and will be earnings
accretive in the first full year. ADM will fund the acquisition through
a combination of operating cash flows and debt.
As part of the agreement, GrainCorp will additionally 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.
GrainCorp has indicated that the ADM 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.
The offer is subject to conditions, set out in the takeover bid
implementation deed viewable at www.adm.com,
which include ADM receiving a minimum acceptance of 50.1 percent of
GrainCorp shares. ADM presently owns 19.8 percent of GrainCorp’s shares.
The company will discuss the GrainCorp transaction during today’s first
quarter financial results conference call and audio webcast at 5 p.m.
Central U.S. Time (8 a.m. Australian Eastern Standard Time). To listen
to the call via the Internet or to download the slide presentation, go
to www.adm.com/webcast.
To listen by telephone, dial (888) 522-5398 in the U.S. or (706)
902-2121 if calling from outside the U.S. The access code is 32838804.
ADM will file a Bidder’s Statement, and GrainCorp will file a Target’s
Statement with the Australian Securities Exchange (the “ASX”).
Barclays and Citi are acting as financial advisors. Corrs Chambers
Westgarth and Cravath, Swaine & Moore LLP are acting as legal advisors.
Forward-Looking Information
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
statements.
About ADM
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.
About GrainCorp
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.
The company:
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Handles ~75 percent of eastern Australia’s annual grain production
through direct receivals at either country sites or port terminals;
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Handles ~90 percent of eastern Australia’s bulk grain exports;
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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
Asia;
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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;
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Produces ~40 percent of Australia’s crude canola oil and refined
edible oils, and is a leading edible oil refiner in New Zealand;
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Imports and exports ~40 percent of Australasia’s edible oil through 12
bulk liquid terminals;
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Produces ~35 percent of Australia’s flour (through 60 percent interest
in Allied Mills).
Archer Daniels Midland Company
Media Relations
David Weintraub, 217-424-5413
media@adm.com
or
Investor Relations
Ruth Ann Wisener, 217-451-8286