Graincorp shares tank on Canadian supply chain sale
Make us a preferred source
Make us a preferred source on Google
More news: Graincorp led losses on the ASX 200 after announcing plans to sell its Canadian supply chain GrainsConnect at a loss of up to $10 million.
Shares were down 14.7% to $7.15 at 2:25pm AEDT.
GrainCorp sells its Canadian supply chain
The news: Agriculture firm GrainCorp announced that it has entered a binding agreement to sell its Canadian supply chain GrainsConnect to Canadian grain company Parrish & Heimbecker.
The context: The sale follows a period of challenging financial performance and structural changes in the Canadian market impacting the earnings improvement for GrainsConnect.
GrainCorp said it expects to see $5 million-$10 million loss on sales, though it does not see the divestment to impact its through-the-cycle EBITDA of $320 million.
The completion of the sale is expected to take place in the first half of 2026.
GrainCorp also expects its FY26 supply volumes to be impacted by lower year-on-year environmental conservation agriculture (ECA), while higher commodity prices are expected to continue placing pressure on price margins.
What they said: "Divestment of GrainsConnect allows GrainCorp to focus on alternative value-creating opportunities that are in the best interest of our shareholders," GrainCorp's managing director and CEO Robert Spurway said.
The source: ASX
