The Australian Competition and Consumer Commission has approved a $A3 billion takeover of GrainCorp by Archer Daniels Midland Company of the United States.
The Australian Competition and Consumer Commission has approved a $A3 billion takeover of GrainCorp by Archer Daniels Midland Company of the United States.
The ACCC said the deal will not lead to a substantial lessening of competition in the grain trade, because competitors of the merged company would still hold over 50% of the market share.
ADM launched a takeover offer worth around $A3 billion in April this year.
The ABC reports the offer was enough to convince GrainCorp's board to back it, but the deal also had to pass with GrainCorp shareholders, and both the ACCC and Foreign Investment Review Board.
The ACCC said GrainCorp currently competes with an ADM subsidiary (Toepfer) in Victoria, New South Wales and Queensland.
However, competitors of these two companies currently account for the majority of grain traded on the east coast and the ACCC believes this competition will continue to constrain an enlarged ADM.
The proposed deal still has to get approval from the Foreign Investment Review Board. It has also faced strong opposition from some members of the federal parliament.
