Decatur, Ill.-based grain trader and processor Archer Daniels Midland is set to acquire a Australian grain processing company for $3.4 billion Australian dollars ($3.48 billion U.S. dollars).
GrainCorp, a Sydney, Australia-based grain processing company, handles 75 percent of eastern Australia's annual grain production. GrainCorp also handles 90 percent of eastern Australia's bulk grain exports and produces 40 percent of Australia's crude canola oil and refined edible oils.
"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," ADM Chairwoman and CEO Patricia Woertz said. "GrainCorp provides an excellent platform to serve that growth, particularly in fast-growing markets in the Middle East, Africa and Asia."
Under the offer, ADM, with facilities in Cedar Rapids, will receive a minimum acceptance of 50.1 percent of GrainCorp shares. ADM now owns 19.8 percent of the company's shares.
It has offered $12.20 Australian dollars — $12.60 in U.S. dollars — per share.
With 30,000 employees worldwide, ADM converts oilseeds, corn, wheat and cocoa into products for food, animal feed, industrial and energy uses. The company has more than 265 processing plants and 460 crop procurement facilities.GrainCorp said the deal will be accepted as long as a better offer is not extended and the regulatory conditions for the acquisition are satisfied or waived by Dec. 31.