Graincorp Ltd (ASX: GNC) shares are up 26% this morning after the grain giant received a $2.4 billion takeover offer!
Graincorp is the largest Eastern Australian grain storage and transport network. It has seven bulk grain ports, it’s in the top five of global malt producers and it’s Australia’s largest integrated edible oils business. Graincorp exports products to more than 30 countries. It has been operating for over 100 years, making it one of Australia’s oldest companies.
Graincorp takeover offer
After undertaking a review of its business, Graincorp has received a non-binding indicative proposal from Long-Term Asset Partners Pty Ltd (LTAP).
The potential acquisition would be priced at $10.42 per share, which represents a 42% premium to the closing price last Friday.
Graincorp’s Board is engaging with LTAP, however, it hasn’t formed a view about whether the price is worth recommending the deal to shareholders yet.
Nonetheless, Graincorp warned that the offer is subject to a number of conditions including complex financing which is based on due diligence.
In 2013, Canadian company Archer Daniels Midland tried to acquire Graincorp for $3 billion but it was knocked back by the then-treasurer.
In its recent FY18 result the company reported statutory profit of $71 million, which was a decline of 43% compared to FY17.
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