China's Sinochem approaches Nufarm about possible takeover

Friday 24th July 2009

Nufarm, Australia’s biggest producer of agricultural chemicals, said it was approached by China’s Sinochem Corp. about a possible takeover.

Shares of Nufarm jumped 9% to A$10.73 on the ASX, valuing the Melbourne-based company at A$1.95 billion. Its range of chemicals includes the Roundup brand herbicides.

“There is no certainty that any agreement will be reached or that an offer or proposal will be put to Nufarm shareholders,” it said in a statement. “The board will consider any offer or proposal it receives having regard to all the alternatives available to the company."

The approach to Nufarm is the second in as many years from a Chinese company after China National Chemical Corp., the nation’s biggest chemicals company, teamed up with US private equity firms Blackstone Group and Fox Paine Management in an unsuccessful proposal in 2007.

Last month, Nufarm said its 2009 earnings may undershoot its forecast A$220 million by about 15% because of a drop in demand for glyphosphate and increased competition, which was driving down prices.

Sinochem hired Royal Bank of Scotland for advice on a possible takeover offer, the Australian Financial Review reported yesterday.

Businesswire.co.nz

Comments from our readers

No comments yet