Tuesday, November 16, 2010 | 12:29 AM ET
CBC News
Agrium president and CEO Michael Wilson in 2008. (Jeff McIntosh/Canadian Press)
Shareholders of AWB Limited, formerly the Australian Wheat Board, have overwhelmingly endorsed a $1.1-billion takeover by Canadian fertilizer producer Agrium Incorporated.
Tuesday's vote, coming shortly after Anglo-Australian miner BHP Billiton gave up its effort to take over Potash Corporation of Saskatchewan, was 97.8 per cent in favour of the bid presented in August with the support of AWB's board and management, Calgary-based Agrium said.
"We are very pleased that AWB shareholders have supported the acquisition and we now look forward to working with AWB employees to build on the excellent relationship that they have developed with customers," Agrium CEO Mike Richards stated late Monday.
"Agrium's focus will be to work with our AWB colleagues to enhance efficiencies across the agricultural value chain."
He added that AWB employees and customers will benefit from the larger, financially stronger organization, and that AWB "provides an excellent base for Agrium's future growth in the Oceania and Southeast Asian region."
Court approval awaited
The Canadian company, which is funding the acquisition largely from cash on hand, said it would apply immediately for Australian court approval of the takeover and it expects the transaction to be completed Dec. 3. In addition to paying the takeover price, Agrium is absorbing about half a billion dollars in AWB debt.
AWB, formed in 1939 as the Australian Wheat Board, was the government's grain marketing authority until it was privatized in 1999. It is the country's largest grain handler, providing merchandising, storage and transport services as well as pool management and trade finance.
It also owns Landmark Rural Services, described as Australia's largest distributor of farm inputs, with 400 locations in Australia and New Zealand providing agricultural products and services ranging from real estate to wool handling.
The friendly takeover of AWB followed Agrium's failure in March to prevail with a $5.5-billion hostile bid for American rival CF Industries Holdings. Wilson observed then that Agrium had completed nine acquisitions in the past five years and would continue looking for takeovers in a "very disciplined" way.
The AWB acquisition was supported by the target company, unlike BHP Billiton's $38.6-billion proposal to acquire PotashCorp, which federal Industry Minister Tony Clement said on Nov. 3 failed to meet the Investment Canada Act's requirement of providing a net benefit to Canada. BHP withdrew the offer late Sunday.
CBC News
Agrium president and CEO Michael Wilson in 2008. (Jeff McIntosh/Canadian Press)
Shareholders of AWB Limited, formerly the Australian Wheat Board, have overwhelmingly endorsed a $1.1-billion takeover by Canadian fertilizer producer Agrium Incorporated.
Tuesday's vote, coming shortly after Anglo-Australian miner BHP Billiton gave up its effort to take over Potash Corporation of Saskatchewan, was 97.8 per cent in favour of the bid presented in August with the support of AWB's board and management, Calgary-based Agrium said.
"We are very pleased that AWB shareholders have supported the acquisition and we now look forward to working with AWB employees to build on the excellent relationship that they have developed with customers," Agrium CEO Mike Richards stated late Monday.
"Agrium's focus will be to work with our AWB colleagues to enhance efficiencies across the agricultural value chain."
He added that AWB employees and customers will benefit from the larger, financially stronger organization, and that AWB "provides an excellent base for Agrium's future growth in the Oceania and Southeast Asian region."
Court approval awaited
The Canadian company, which is funding the acquisition largely from cash on hand, said it would apply immediately for Australian court approval of the takeover and it expects the transaction to be completed Dec. 3. In addition to paying the takeover price, Agrium is absorbing about half a billion dollars in AWB debt.
AWB, formed in 1939 as the Australian Wheat Board, was the government's grain marketing authority until it was privatized in 1999. It is the country's largest grain handler, providing merchandising, storage and transport services as well as pool management and trade finance.
It also owns Landmark Rural Services, described as Australia's largest distributor of farm inputs, with 400 locations in Australia and New Zealand providing agricultural products and services ranging from real estate to wool handling.
The friendly takeover of AWB followed Agrium's failure in March to prevail with a $5.5-billion hostile bid for American rival CF Industries Holdings. Wilson observed then that Agrium had completed nine acquisitions in the past five years and would continue looking for takeovers in a "very disciplined" way.
The AWB acquisition was supported by the target company, unlike BHP Billiton's $38.6-billion proposal to acquire PotashCorp, which federal Industry Minister Tony Clement said on Nov. 3 failed to meet the Investment Canada Act's requirement of providing a net benefit to Canada. BHP withdrew the offer late Sunday.
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