Olam Shares Gained Over 3% after Topping Louis Dreyfus’ Offer for Australia’s Namoi Cotton as Takeover Battle Heats Up
One day after Dutch global commodity merchant Louis Dreyfus Company raised its takeover offer to A$0.67 per share for Namoi Cotton, Olam Agri has topped the bid by raising its stake to A$0.70 per share on Wednesday (May 8), heating up the tussle for the Australia’s largest cotton ginner.
Olam shares gained over 3% in morning trading.
The new offer by Olam Group’s indirect 64.57 per cent-owned subsidiary would value Namoi at A$144.9 million (S$129.4 million), up from rival bidder’s stake of A$138.6 million .
Shares of the Australian cotton-ginning company rose as much as 2.8 per cent to A$0.74, the highest since November 1999, after Louis Dreyfus upped its bid on Tuesday to be A$0.01 per share higher than Olam Agri’s A$0.66 per share offer last Thursday.
Olam Agri noted that the new A$0.70 offer price applies regardless of whether or not Olam obtains a relevant interest in at least 90 per cent of Namoi shares before the end of the offer period.
Last Thursday, Olam Agri sweetened its offer to A$0.66 per share, subject to obtaining an interest in at least 50.1 per cent of Namoi shares, and proposed to increase its offer value to A$0.70 per share if it obtains at least 90 per cent of Namoi shares before the end of the offer period.
The Olam’s majority-owned agri-business unit noted on Wednesday that the new offer conditions are otherwise the same limited ones as those announced last Thursday. These conditions are 1) Olam having obtained a relevant interest in at least 50.1 per cent of the Namoi shares; 2) receipt of regulatory approvals from Foreign Investment Review Board and Australian Competition and Consumer Commission; and 3) no prescribed occurrences occurring in relation to Namoi before the end of the offer period.
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Olam outbids Dreyfus’ sweetened deal for Australia’s Namoi, raises offer to A$0.66 per share
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This is the third time that Olam Agri upped its ante in the takeover battle over Namoi that has started since January.
While Olam Agri owns Namoi’s rival Queensland Cotton, gaining control over the Australia’s largest cotton producer would help either bidders expand its already notable presence in the country with access to Namoi’s ginning network and warehouses in New South Wales and Queensland.
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