Sector News

ADM to sell $400m GrainCorp stake

July 26, 2016
Consumer Packaged Goods

UBS, Morgan Stanley and Goldman Sachs are pitching tonight for a role to underwrite ADM’s exit for its $400 million stake in GrainCorp.

It comes after reports that Archer Daniels Midland was moving to sell its 20 per cent interest in GrainCorp tonight.

However, it is now understood that only half the stake is now being sold.

ADM made an attempt to buy GrainCorp in a $2 billion offer during 2013.

However, the deal was blocked by the Treasurer at the time, Joe Hockey.

It comes amid a period of angst by deal makers surrounding foreign investment, after the recent Australian federal election shifted the power dynamics in parliament towards opponents of foreign investment.

A Dutch auction was underway tonight for the stake, sources said.

Lazard is running the Dutch auction — where the price of the offering is set once all bids are received — on behalf of ADM, sources said.

Brokers’ pitches were due in at 7pm.

According to sources, the deal was likely to be struck at a discount to the close price.

By Bridget Carter

Source: The Australian

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