An exciting day saw the meandering battle for control of Namoi Cotton, the country’s top cotton producer, end with a win to French group Louis Dreyfus Company (LDC).
The day saw two pauses in trading, a higher offer from LDC and news that one of the French agri commodities giants had emerged as the biggest shareholder before trading started in the morning.
The day ended mid-afternoon with a letter from lawyers for the rival, Olam of Singapore, pulling the plug on its battle and revealing that it will be letting its offer lapse on 8 October.
LDC had been jousting with the Singapore-based Olam for more than five months for control of Namoi. Namoi insiders favoured Olam, which, up to yesterday, had the higher offer in the market of 77 cents, compared to the French group, whose offers were, previously, 67 cents a share, 68 cents, 70 cents, and yesterday a matching 77 cents a share (which valued Namoi at just $156 million).
LDC started the day by revealing it had lifted its stake in Namoi to 47.66% from 22.32% previously, according to a stock exchange filing showed on Tuesday. The filing showed that LDC's acquisition of stock was from shareholders accepting its takeover offer for Namoi.
A day earlier, the group had boosted for Namoi to 68 cents a share, from 67 cents previously, although this still trailed rival bidder Olam Agri Holdings’ 75 cents a share offer.
LDC then lobbed a new price of 77 cents a share at 10.24am, after a pause in trading 12 minutes earlier, presumably to allow the market to digest the letter and the higher price.
Around 47 minutes later, there was another pause that continued to noon, when it was lifted. The shares traded at 77 cents, up 8.45%.
Olam's proposal also had the backing of major shareholders Samuel Terry Asset Management and Harvest Lane Asset Management.
But LDC’s shareholder filing showed that it had bought Samuel Terry Asset Management's 25% stake in Namoi – which meant game over. Olam tossed in the towel.
LDC’s proposed acquisition has received clearance from the Australian Competition and Consumer Commission as well as the Foreign Investment Review Board.
