China's state-owned Sinochem Corporation yesterday made a provisional $2.5-billion takeover bid, for Australia's agricultural chemical manufacturer Nufarm, in order to expand its global footprint and become a leading global crop protection company.
Nufarm is one of the world's leading crop protection companies with manufacturing and marketing operations based in Australia, New Zealand, Asia, Europe and the Americas, and sells products in more than 100 countries around the world.
Sinochem Corporation, part of the Fortune 500 Company Beijing-based Sinochem Group, said that it has entered into a heads of agreement with Nufarm to acquire all of the issued ordinary shares in Nufarm for A$13.00 per share - a 17-per cent premium to Nufarm's last closing price.
Nufarm will work with Sinochem until 3 December 2009 on an exclusive basis to negotiate a transaction implementation agreement, which would includes a five-week period in which Sinochem will undertake due diligence on Nufarm.
In a statement, Nufarm said that if an agreement is reached, the Melbourne-based company's board intends to unanimously recommend the proposed acquisition, unless a superior offer materialised, and subject to an independent expert finding that the proposed scheme is in the best interests of Nufarm shareholders.
The agreement would be subject to Chinese and Australian government approval, including Australia's regulator, Nufarm shareholders and court approval.