Dive Brief:
- Australia's Treasurer blocked a $2.6 billion takeover of GrainCorp, that nation's largest publicly traded grains company, by U.S.-based ADM.
- The decision sent markets reeling. GrainCorp shares lost 25 percent of their value Friday. GrainCorp's CEO resigned over the weekend and took a job with Coca-Cola Amatil.
- The decision is widely seen as political. Grower groups and Australia's liberal parties viewed the deal as a threat to national autonomy. It was also an opportunity for the left to take a stand against a newly elected Conservative prime minister who campaigned on a promise to open Australia's markets.
Dive Insight:
We know little of Australian politics. Perhaps that's why the decision by Australia's Treasurer seems particularly impolitic. On the other hand, we share that emotional attachment to the business of grain.
The decision is a serious blow to ADM, which is looking for ways to serve the rapidly growing markets in Asia. Here's hoping ADM finds someone else to do business with.