Cargill gets approval for AWB acquisition from Agrium

Sydney-Australia’s competition watchdog, the Australian Competition & Consumer Commission (ACCC), has given its approval to Cargill Inc.’s A$1.24 billion acquisition of the commodity management business Agrium Inc. acquired with its takeover of Australia’s AWB Ltd. “The ACCC concluded that the proposed acquisition would be unlikely to enable Cargill post merger to depress prices paid to growers for grain or raise prices of grain to domestic customers due to the presence of the remaining grain traders,” ACCC Chairman Graeme Samuel said in a statement. The existing competition between Cargill and AWB is focused mainly in New South Wales in grain trading, and to a lesser extent grain storage and handling, ACCC said. Other competitors in that locale include GrainCorp, the largest grain trader and storage provider in New South Wales, as well as Cooperative Bulk Handling, the Elders Toepfer joint venture, Glencore, and Viterra. Ralph Selwood, Cargill Australia’s managing director, said in a statement that ACCC’s announcement is a significant milestone following the sales agreement with Agrium reached in December (GM Dec. 20, 2010). He added, however, that a decision from Australia’s Foreign Investment Review Board is still required for the sale to proceed. AWB is a leading agricultural retailer in Australia, with more than 200 company-operated retail locations, more than 140 additional retail franchise and wholesale customer locations in Australia, and investments in various related joint venture companies. Agrium successfully completed its acquisition of AWB on Dec. 3, 2010 (GM Dec. 6, 2010).