GrainCorp relinquishes all 8.7 million shares in AWB

29 Jan, 2003 10:00 PM
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NSW grain handler GrainCorp last week disposed of its entire holding of 8.7 million shares in AWB Ltd.

The sale involved a number of buyers and took place off market.

When GrainCorp first acquired the AWB shares a few years ago, it employed an intensive media campaign which urged wheatgrowers to sell their shares to the company ‹ a move which created much speculation about the motives for the buy-up, even leading to AWB supporters to urge shareholders to consider carefully before divesting.

While GrainCrop now claims the move "ceased to be a strategic investment", industry analysts believe the sale was prompted by GrainCorp's acquisition of Allied Mills in partnership with Cargill Australia.

GrainCorp did not disclose the agreed price for the disposal of its AWB shares but it confirmed it has exited for a profit and was "pleased with the result of its commercial investment in AWB".

GrainCorp has already announced it will remain cash flow positive for the current financial year.

"The decision to sell was based on the diminished importance of the investment as part of GrainCorp's overall strategy," GrainCorp managing director Tom Keene said.

"GrainCorp will continue to investigate opportunities for expansion of its core business and acquisition of new businesses and will pursue these where appropriate."

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