Long-Term As­set Part­ners’ bold move to pur­chase Grain­Corp

Warwick Daily News - South West Queensland Rural Weekly - - News - Madeleine Stuch­bery [email protected]­ral­weekly.com

BULK-GRAIN han­dler Grain­Corp is con­sid­er­ing a takeover pro­posal worth an es­ti­mated $2.4 bil­lion from Long-Term As­set Part­ners.

The grain-han­dling gi­ant re­ceived a non-bind­ing pro­posal at the end of Novem­ber to ac­quire the com­pany.

But the Grain­Corp board ex­pressed con­cerns about the long-term fi­nan­cial plan­ning of the busi­ness and the iden­tity of in­vestors un­der­pin­ning the pro­posal. The bid val­ued Grain­Corp stocks at $10.42 a share, rep­re­sent­ing a premium of 42.7 per cent to the last clos­ing price of Grain­Corp shares of $7.30 on Novem­ber 30.

LTAP chair­man Tony Shep­herd said the pro­posal would en­sure stable de­vel­op­ment of Grain­Corp and would guar­an­tee own­er­ship and con­trol re­mained in Aus­tralian hands.

“Un­der our pro­posal, Grain­Corp share­hold­ers have the op­por­tu­nity to re­ceive an im­me­di­ate cash pay­ment at a sig­nif­i­cant premium and at a price which we be­lieve rep­re­sents a very at­trac­tive value for the com­pany,” Mr Shep­herd said.

“Our plans for Grain­Corp’s as­sets are fo­cused on in­creas­ing vol­umes over time.

“There are many as­pects of our strat­egy for the com­pany’s fu­ture but in­creas­ing vol­umes is cen­tral.

“In­creased pro­duc­tion vol­umes are good for farm­ers and good for Grain­Corp.”

“The pro­posal is sub­ject to a num­ber of con­di­tions,” the Grain­Corp board re­sponded, “and in­volves a com­plex fi­nanc­ing struc­ture with sig­nif­i­cant lever­age com­pris­ing $3.2 bil­lion in ac­qui­si­tion fa­cil­i­ties from Gold­man Sachs and $400 mil­lion from West­bourne Cap­i­tal.”

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