GrainCorp rejected on Thursday a sweetened $2.9 billion bid from U.S. agribusiness giant Archer Daniels Midland, saying the offer materially undervalues Australia's last major independent grains handler.
Australian agricultural businesses have been targeted by big players in recent years, part of a global consolidation amid intense competition to feed fast-developing countries seeking food security.
GrainCorp is the last available independent asset of scale in Australia, the world's second-largest wheat exporter and an attractive market due to stable policies and good links to Asia.
ADM lifted its offer last month by 3.8 percent from A$11.75 per share to A$12.20 per share in cash -- a 40 percent premium to GrainCorp's share price at the time of the initial offer in October.
"The increase in the proposed price has not changed the board's view that ADM's proposal materially undervalues GrainCorp," the Australian company said in a statement, pointing to the firm's unique portfolio of assets.
GrainCorp operates seven of the eight bulk grain elevators in eastern Australia, handling as much as 60 percent of the region's wheat, barley, canola, chickpea and sorghum crops. It took in 12.2 million tonnes of grain last season.
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Analysts have previously told Reuters the revised bid was still below the average acquisition multiple for Australian and global agribusinesses based on forward earnings.
ADM did not immediately respond to emails seeking comment.