SYDNEY, AUSTRALIA — ADM Australia Holdings II Pty Limited, a wholly owned subsidiary of Archer Daniels Midland Company (ADM), on June 23 lodged with the Australian Securities and Investments Commission its bidder’s statement for an all-cash, off-market takeover offer for GrainCorp Limited. The GrainCorp board has unanimously recommended shareholders accept the offer, in the absence of a superior offer. 

“We believe our offer is highly attractive and in the best interests of shareholders,” said ADM Chairman and Chief Executive Officer Patricia Woertz. “The Independent Expert has assessed the proposal and concluded that it is fair and reasonable, in the absence of a superior proposal. We also believe ADM’s offer will deliver compelling benefits to Australian growers and the agricultural economy through access to new markets, investment in agricultural infrastructure, and its focus on serving the needs of Australian growers.”

GrainCorp released its target’s statement in which the GrainCorp directors unanimously recommend that shareholders accept the offer from ADM Australia Holdings II Pty Limited to acquire all of the GrainCorp shares not already held by it, in the absence of a superior proposal.

The target’s statement contains GrainCorp’s formal response to the offer, including detailed reasons for the GrainCorp directors’ recommendation, as well as other relevant information for shareholders to consider in deciding whether or not to accept the offer. Shareholders are advised to read the target’s statement, together with ADM Australia’s bidder’s statement, carefully and in their entirety.

The all-cash offer price of A$12.20 by ADM, together with illustrative Permitted Dividends of A$1.00 a GrainCorp Share by GrainCorp, represents: 
•           A 49% premium to the last closing price of GrainCorp shares of A$8.85 on Oct. 18, 2012 – the date of the last undisturbed share price before ADM first approached GrainCorp; 
•           A 48% premium to the one-month, volume-weighted average GrainCorp share price of A$8.90 up to Oct. 18, 2012; and 
•           A 44% premium to the three-month, volume-weighted average GrainCorp share price of A$9.14 up to Oct. 18, 2012. 

“Agriculture is an increasingly global business, and Australia is well positioned to take advantage of growing global markets in places like Asia and the Middle East,” Woertz said. “Our objective is to help Australia meet that challenge, by giving growers more choice, greater access to global markets, more efficient and effective logistics and a deeper knowledge of market dynamics and best practices.” 

The bidder’s statement confirms that ADM will: 
•           Continue to operate GrainCorp’s port services in accordance with the current open access arrangements and will continue the current access arrangements for upcountry silos; 
•           Support or invest A$300 million in capital expenditure in the GrainCorp business from the execution of the takeover bid implementation deed on April 25, 2013, which includes: 
            — Supporting expenditures to implement programs announced by GrainCorp on Nov. 15, 2012 (including strategic initiatives, asset optimization initiatives and ports flexibility initiatives); and 
— Investing an additional A$50 million over the next few years on strategic expenditure for the GrainCorp business; 
•           Invest, on average, between A$40 million and A$60 million annually over the coming years in the maintenance and improvement of existing infrastructure assets; 
•           Investigate opportunities to improve the throughput and performance of GrainCorp’s systems; 
•           Implement technology sharing/innovation and share best practices in order to help growers succeed; 
•           Create a Grower and Community Advisory Group to provide a two-way conduit between GrainCorp management and the views of growers and their communities; and 
•           More than double GrainCorp’s current yearly community giving to A$1 million a year. 

“We have a long and proud history of strong grower relationships across all of our operations,” Woertz added. “We are excited by the opportunity to be a partner with the Australian grower community as we help realize a bright future for Australian agriculture.” 

The offer is scheduled to close at 7 p.m., Sydney time on Aug. 31, 2013, (unless extended) and is subject to a number of conditions, including the following (which are set out in greater detail in the Bidder’s Statement): 
•           50.1% minimum acceptance (including the 19.85% relevant interest ADM currently holds); 
•           No objection by the Australian Foreign Investment Review Board or the Australian Competition and Consumer Commission; 
•           Receipt of required regulatory clearances in other jurisdictions; 
•           No prescribed occurrence in relation to GrainCorp; and 
•           No material adverse change in relation to GrainCorp. 

The bidder’s statement will be dispatched to shareholders on July 1, 2013. In the meantime, the bidder’s statement can be viewed at

GrainCorp shareholders may also become entitled to receive an earnings dividend, being a dividend equal to A3.5¢ per share for each full month between Sept. 30, 2013 and the earnings dividend end date (expected to be the date the regulatory conditions of the offer. 

The earnings dividend is expected to be fully franked and provides compensation to shareholders in the event there are delays in satisfying the regulatory conditions. Payment of the earnings dividend is subject to GrainCorp being profitable over the period during which the earnings dividend accrues, the GrainCorp directors maintaining their recommendation of the offer over that period and the offer becoming unconditional.

Credit Suisse and Greenhill are acting as financial advisers and Gilbert+Tobin is acting as legal adviser.