PM 'poised to veto GrainCorp takeover'

EXCLUSIVE Andrew Probyn and Shane WrightThe West Australian

Senior Liberals believe Tony Abbott is poised to veto a multi-billion dollar takeover of Australian wheat company GrainCorp.

In the first big test of the Prime Minister’s claim that Australia is "open for business", coalition figures say Mr Abbott is inclined to say no to the purchase or make conditions so onerous as to make it unviable.

But Treasurer Joe Hockey has rejected the suggestions, saying the decision is his alone.

Archer Daniels Midland is making a $3.4 billion takeover bid for the East Coast bulk grain handler.

Mr Hockey has until December 17 to make a decision under foreign investment laws whether to allow the sale which is being opposed by wheat growers through Queensland, NSW and Victoria.

Some rural Liberals and members of the Nationals, including Deputy Prime Minister Warren Truss, have effectively urged Mr Hockey to reject the sale.

One Cabinet minister supportive of the sale believes Mr Truss was speaking with the PM’s "imprimatur" when he spoke stridently against the move 12 days ago on the ABC’s Insiders program.

The Senate yesterday agreed to a short inquiry into the sale. It will be co-chaired by Bill Heffernan, a NSW rural Liberal, farmer and ally of Mr Abbott.

Senator Heffernan told The West Australian he would put "difficult questions" to GrainCorp, ADM and the competition watchdog ACCC.

"The debate so far has been informed by lobbyists with work-shopped words and a series of lunches," he said.

"All the critical questions have been avoided such as the incapacity of regulation to protect the interests of farmers and traders.

"Thus far, the biggest winners of this proposed sale will be the hedge funds for whom it’s just a financial play worth hundreds of millions of dollars in reward.

But WA Liberal Dean Smith, who backed the Labor Government’s deregulation of wheat exports last year, used the Senate last night to back the sale.

He accused ADM’s opponents of trying to use the debate as a Trojan horse against wheat deregulation.

"Why on earth would ADM spend $3.4 billion – its largest overseas investment ever - to acquire GrainCorp, only to see its newly purchased export infrastructure used inefficiently?" Senator Smith said.

"Having made such a large investment, common sense tells you ADM will be working to attract more growers to the GrainCorp supply chain by improving it, not limiting access to it."

A spokesman for Mr Hockey told The West Australian today that Mr Abbott cannot veto the decision because it is not his to make.

“This is solely a decision for the Treasurer to take,” he said.

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