CBH rejects ASX listing plan
UPDATE 2pm: CBH has rejected a GrainCorp financed bid to turn it from a grower-controlled cooperative to a corporation listed on the ASX.
The CBH board met today and unanimously came to the conclusion the proposal would destroy value for its members and their grain infrastructure and export network.
CBH had been asked to sign a document committing it to putting a corporatisation offer to a vote of its 4145 members before October.
Australian Grains Champions, a private company, had been campaigning for CBH to sign a process agreement by March 18.
AGC needed the support of 75 per cent of CBH growers for its plan - debt financed by GrainCorp and First State Super with $600 million - to succeed.
AGC promised growers up to $1 billion in cash as well as share in a listed entity controlling grains infrastructure and exports in WA.
CBH regards the offer as highly conditional and the two parties have been in a stand off over CBH's request for more detail on the proposed deal.
CBH chairman Wally Newman said the AGC proposal had been carefully considered.
He said the proposal gave too much power to GrainCorp and lacked transparency, described it as blantantly deficient.
AGC will now consider its options, which include gathering enough support to call an emergency general meeting of CBH members.
AGC board member Brad Jones said the CBH’s decision came as no surprise.
"At no stage has the CBH board sought to engage in a discussion about the merits of the proposal and so this was always going to be a disappointing but entirely predictable outcome,” he said.
"Nonetheless I cannot help but wonder on what basis the non-grower directors, in particular, have satisfied themselves that the boards' position is in the best interests of growers.
"Growers are very disappointed that the CBH board is blocking them from seeing a balanced assessment and full details of the proposal.
"The response from growers to date has been extremely encouraging and on this basis we will continue to work with the members of CBH to evaluate all options to ensure they, not the board, have the chance to consider the proposal and vote on its merits.”
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