Archer Daniels Midland Company's Dec. 3 offer to acquire Australia-based GrainCorp has been denied.
GrainCorp said Friday that the offer of $12.20 per share in cash "undervalued" the company.
The Dec. 3 offer followed an original offer that came in October for $11.75 per share. ADM made the offer following a buy-up of 10% interest in the GrainCorp, adding to 4.9% economic interest that ADM previously held. This transaction forced acquisition talks.
Grain Corp on Nov. 15, however, rejected that offer.
ADM on Friday said the latest offer, when combined with the dividend of $0.35 per share announced on Nov. 15, represented a total value to GrainCorp shareholders of $12.55 per share.
“The revised proposal represented a substantial premium to the prevailing GrainCorp share price at the time of our first approach," Jackie Anderson, ADM spokesperson, said. "We believe that our revised proposal properly values GrainCorp’s business, taking into account GrainCorp’s 2012 results and its new initiatives announced on Nov. 15. Our proposal offered more certainty, greater value and immediate realization of potential future value for GrainCorp shareholders than GrainCorp’s stand-alone plan."
GrainCorp says its board will be "constructive in any dealings in relation to proposals that have the potential to be in the best interests of shareholders," while ADM says it plans to continue to consider all options with respect to Grain Corp.