Spanish bid for Australia's SunRice fails
Spanish food giant Ebro said Tuesday its bid to take over Australia's Ricegrowers Ltd. had collapsed after failing to win over enough shareholders.
Ebro announced last November it had signed a definitive deal to take over Ricegrowers, owner of the SunRice brand, for 600 million Australian dollars (440 million euros, $570 million).
But the plan to take over Australia's biggest rice supplier needed approval from the target company's shareholders and Australian regulators.
"Shareholders in Ricegrowers Ltd.-SunRice have decided not to support the takeover offer presented by Ebro," Spain's biggest food group said in a statement.
In total, 67 percent of its class A shares and 76 percent of class B shares were cast in favour of the takeover, giving less than the 75-percent overall majority required for the deal to go ahead, Ebro said.
"The deal was complicated from the start," Ebro president Antonio Hernandez Callejas said.
"Reaching the super-majority was a complicated goal but Ebro has an excellent financial position to achieve other similar targets, whether in rice or pasta," Callejas said.
"We will maintain the excellent relations we have had with SunRice up to now and maybe in the future, if it changes its complex corporate struucture, we can find new ways to cooperate," he added.
The Spanish group would search in the meantime for alternatives to get a foothold in the region, he said.
SunRice, which is weighed down by high debt, sells around 500,000 tonnes of rice per year and has leading positions in its main markets, including New Zealand, the Pacific Islands, Hong Kong, Singapore and the Middle East.
It controls brands such as Riviana, Sunwhite, Sunbrown, Sunlong, Calrose and Mahatma, as well as the Always Fresh label.
Shares in Ebro, which owns major brands including Lustucru and Panzini, fell 1.82 percent while the wider market gained more than two percent.
© 2011 AFP