Thursday, May 21, 2009

Viterra $1.4B takeover bid endorsed by ABB board

Viterra $1.4B takeover bid endorsed by ABB boardViterra 3-month TSX chart

Viterra Inc. said Tuesday that its $1.4-billion cash-and-stock takeover bid for Australian company ABB Grain Ltd. has been endorsed by the target's board of directors.

In the absence of a better offer, the ABB directors unanimously recommended that shareholders accept the offer from the Prairie-based grain company.

"Over a considerable period of time, our respective companies have developed a solid understanding of each other's operations, management philosophies and strategic goals," said Mayo Schmidt, the president and CEO of Viterra, which used to be known as the Saskatchewan Wheat Pool.

"This relationship has culminated into a transformational combination that will drive significant value for all shareholders, destination customers and growers," he said.

In a conference call, Schmidt said the takeover would give Viterra added clout in growing markets, particularly in Southeast Asia and China.

The takeover deal is still subject to shareholder approval.

Regina-based Viterra originally unveiled its offer for ABB in late April.

ABB, formerly the Australian Barley Board, is a grain, malt and rural services company with 1,100 employees. It has been looking for a partner in the grain business.

Viterra took over Agricore United in 2007 for about $1.8 billion.