Namoi shares soar as largest shareholder backs Olam's takeover bid
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More news: Namoi Cotton's largest shareholder Samuel Terry Asset Management said it is supportive of Olam Agri's increased takeover offer for the Queensland cotton operator, and has encouraged the Namoi board to engage with Olam over the offer.
Namoi shares were up 11% to $0.71 by 11:30am AEST.
Samuel Terry, which holds a 24.2% stake in Namoi, said that it intends to accept Olam's revised bid in the absence of a superior bid and subject to the independent expert appointed by Namoi. The asset manager considers the bid superior to the proposal by rival suitor Louis Dreyfus Company.
Olam tops LDC offer in takeover tussle for Namoi Cotton
The news: Singapore-based agribusiness Olam Agri has improved its off-market takeover offer for Queensland cotton operator Namoi Cotton, in the latest move in its takeover tussle with rival suitor Louis Dreyfus Company (LDC).
The numbers: Olam's new offer of 66 cents per Namoi share is subject to obtaining a relevant interest in at least 50.1% of Namoi's shares. Olam said it proposes to hike the offer to 70 cents per Namoi share if it obtains a relevant interest in at least 90% of its shares before the end of the offer period.
On Monday, French agri commodities firm LDC lifted its bid for Namoi to 60 cents per share, up from its initial offer of 51 cents per share made in January. It topped Olam's prior offer of 59 cents per share, plus a special dividend of 1 cent per share, made in March.
The context: Olam, majority owned by SGX-listed Olam Group, already has a presence in Australia through its wholly owned subsidiary Queensland Cotton, which it acquired in 2007. Its parent company Olam Group also employs over 550 people in Australia through its almond orchards and processing businesses.
Meanwhile, LDC is Namoi’s second-biggest shareholder with a 16.99% stake and also operates a joint venture with the Australian firm.
What they said: Olam co-founder and group CEO Sunny Verghese said: "Olam has significant global cotton industry expertise, including our operations in Brazil where we are also a grower, and Africa where we support our network of 340,000 farmers to improve practices and maximise incomes".
"The international experience and deep local knowledge, coupled with our credentials as one of the world's largest private cotton ginners, positions us perfectly to support Namoi and foster its future growth," he said.
The source: ASX announcement
