Treasurer Joe Hockey has announced he will make a decision on the controversial $3.4 billion bid by the US giant Archer Daniels Midland for the Australian agribusiness GrainCorp by December 17.
The acquisition bid is highly controversial with the Nationals particularly concerned about its implications. Leading Nationals have spoken out publicly against it.
The bid has been examined by the Foreign Investment Review Board, and the final decision is formally in the hands of Hockey alone. By setting a date Hockey is in effect forcing the various parties to come together for negotiations, because these decisions are worked through on a consultative basis.
Hockey said setting a time would provide “certainty to all parties”.
He reiterated in a statement late today that Australia welcomed foreign investment because of its benefits to the economy. “Australia’s foreign investment review framework allows the government to examine foreign investment applications on a case by case basis to ensure they are not contrary to Australia’s national interest,” he said.
GrainCorp is a significant Australian company involved in grain marketing, processing, storage and transport in NSW, Queensland and Victoria. The current statutory period ends next week and would normally just be rolled over. But Hockey said he had decided to extend it “given the size of this transaction and the complex nature of the issues involved”.
“This will allow suitable time for the new government to carefully consider all the relevant issues and advice from the Foreign Investment Review Board before making a decision,” he said.
There has been speculation that Hockey might approve the bid with conditions. The Australian Competition and Consumer Commission has no objection to the bid on competition grounds.
The new Liberal member for Hume, Angus Taylor, who is expert in the area of agribusiness said: “GrainCorp has 60% plus of market share in grains handling, storage and transportation on the east coast. I could envisage conditions and undertakings that would put real dollars in growers pockets, or conditions under which they don’t.”
Grower representatives met with Agriculture Minister Barnaby Joyce and government officials on Thursday to oppose the takeover.