GrainCorp CEO Resigns After ADM Deal Collapses

   By Rhiannon Hoyle 
 

SYDNEY--GrainCorp Ltd. (GNC.AU) suffered its second blow in almost as many days when its chief executive quit in the wake of Australia's rejection of a 3 billion Australian dollar (US$2.7 billion) takeover bid by U.S. agribusiness Archer Daniels Midland Co. (ADM).

Alison Watkins said she would leave next month after three years as GrainCorp's chief executive, with chairman Don Taylor taking on executive duties on an interim basis until a successor is found.

"I have carefully weighed my options over the past two days," Ms. Watkins said in a statement to Australia's stock exchange. "I had planned to leave the company at the time control passed over to ADM."

GrainCorp shares dropped sharply after intense lobbying by farmers and some conservative politicians helped derail the deal with ADM--the first to be opposed by the new Conservative government since their September election victory. Austrlian Treasurer Joe Hockey said Friday that the deal couldn't proceed on national interest grounds.

The proposed acquisition would have left 60% of wheat shipments from Australia controlled by three companies: ADM, Glencore Xstrata PLC (GLEN.LN) and Cargill Inc. It also would have put almost all the country's eastern grain export infrastructure under foreign ownership.

"The expectation in the investment community was that ADM's offer for GrainCorp would be approved and effected in the near term," Mr. Taylor said. "In that context, it is not surprising that an executive of Alison's caliber has attracted interest and had new opportunities presented to her."

GrainCorp said Ms. Watkins is leaving for a new opportunity in the corporate sector, but didn't elaborate. An external and internal search for her successor has already started.

A senior ADM official said earlier that the company was considering an enlarged stake in GrainCorp, and wouldn't appeal the acquisition ruling. Those remarks followed Mr. Hockey's comment that he would likely allow the U.S. grains giant to boost its investment in the company to 24.9% from its current 19.9% "to encourage ADM to demonstrate its commitment to the Australian grains industry."

Write to Rhiannon Hoyle at [e-mail]

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