CALGARY, ALBERTA, CANADA — Agrium Inc announced on Aug. 15 that it has submitted a fully financed proposal to acquire AWB Limited at a price of A$1.50 per AWB share. The proposal represents a 57% premium to the trading price of A$0.955 on July 29, which was just prior to the Graincorp/AWB merger announcement. Agrium’s proposal was sent to the AWB board on Aug. 14.
Agrium is in discussions with AWB with the intention of agreeing to a proposal that the AWB board would recommend to its shareholders.
"The proposed transaction with AWB would continue Agrium’s strategy of growing its retail business. Agrium sees significant potential to enhance the product and service offerings to the Australian and New Zealand grower, particularly through AWB’s retail Landmark Rural Services division, by utilizing Agrium’s international fertilizer and crop protection sourcing capabilities, while supporting further growth within each division of AWB," said Agrium President and Chief Executive Officer Mike Wilson.
The proposal is currently envisaged to be executed via a scheme of arrangement and is subject to conditions precedent typically included in transactions of this type, including the unanimous support of the AWB board.
Agrium has engaged Barclays Capital as financial advisor and Clayton Utz as legal advisor in connection with the transaction.
AWB currently has 817,304,356 shares and 7,878,926 performance rights issued, which the proposal is based upon, resulting in a purchase price of A$1.238 billion.