Competition Clears ABB, AusBulk, UGH Merger

SYDNEY - Aug 31/04 - The Australian Competition and Consumer Commission has approved the merger between The Australian barley marketing board, ABB Grain Ltd, AusBulk Ltd and United Grower Holdings based on an agreement by ABB to provide access to South Australia’s port grain terminals.

Proposed chairman of the merged entity, Perry Gunner, said the merged entity would provide an enforceable undertaking that it would not unfairly or unreasonably hinder or deny access to AusBulk’s port terminals for grain exporters and would not unfairly or unreasonably discriminate between grain exporters in respect of port charges and provision of services. This undertaking, which will last for five years, would have little operational impact on the company.

He said the concerns of the ACCC regarding access were understandable. Notwithstanding the excellent record of the grains industry in handling such potential conflicts, the ACCC was obliged to consider what changes may occur within the grains industry in the future, and the possible impact of those changes on competition.

Documentation on the merger proposal has been posted to shareholders of all three companies, prior to an extensive round of grower meetings which will be held in South Australia, Victoria and New South Wales preceding the shareholders’ polls.

Shareholders will be asked to vote on the merger proposal at three separate but consecutive special meetings in Adelaide on September 21.

It is proposed that the merger be achieved in two separate but related schemes of arrangement in which AusBulk and UGH shareholders will swap their shares for newly issued B-Class shares in ABB.

It is estimated that the merged entity will have market capitalization in excess $850 million, taking it into the top 150 ASX-listed companies by market capitalization and making it the second largest ASX-listed grain business in Australia.