Graincorp To Sell Its Australian Bulk Liquid Terminals To ANZ Terminals

Graincorp To Sell Its Australian Bulk Liquid Terminals To ANZ Terminals

The Agricultural company, GrainCorp Limited (ASX: GNC) has announced the sale of its Australian Bulk Liquid Terminals business. The company has entered into an agreement with ANZ Terminals Pty Ltd to sell its Australian Bulk Liquid Terminals for a total consideration of around $350 million.  Following the release of this news, the share price of the company decreased by 1.018% with the close of trading session on 4 December 2019.

Under the terms of the transaction, GrainCorp Oils will enter into a long-term storage agreement with ANZ Terminals which will allow secure access to the company’s oils business. ANZ Terminals is a highly experienced privately-owned company which provides bulk liquid storage terminals across Australia and New Zealand.

While commenting on this transaction, GrainCorp Oils’ General Manager Sam Tainsh told that the management of the company will work with ANZ Terminals to ensure a smooth transition for its customers and its people. He further added that, through the long-term storage agreement, the company will have the access required for its trading and liquid feeds businesses.

The Australian Bulk Liquid Terminals business was acquired by GrainCorp in 2012 as part of the acquisition of Gardner Smith, and since that acquisition, the business has evolved substantially and is increasingly serving other sectors, in addition to the edible oils commodities that are more closely aligned with GrainCorp’s core business.

The sale of the Australian Bulk Liquid Terminals is an outcome of GrainCorp’s ongoing Portfolio Review strategy and highlights the value within the Company’s portfolio. At the recently held Annual General Meeting, the company’s Chairman informed that the company’s Board and management are working through a comprehensive review of its asset portfolio for many months, aimed at identifying options to maximize value for shareholders.

GrainCorp has retained ownership of its New Zealand bulk liquid terminals, which are more fully integrated into its supply chain; however, it is independently reviewing options for this business as part of the ongoing Portfolio Review.

For the year ended 30 September 2018, the company reported EBITDA of $269 and underlying net profit after tax (NPAT) of $71 million.

Now, let’s have a glance at the company’s stock performance and the return it has posted over the past few months. The stock is trading at a price of $9.720 with a market capitalisation of ~$2.25 billion as on 4 March 2019. The counter opened the day at $9.870 and reached the day’s high of $9.930 and touched a day’s low of $9.700 with a daily volume of ~ 546,410. The stock has provided a year-till-date return of 8.75% & also posted returns of 23.99%, 6.16% & 3.15% over the past six months, three & one-months period respectively. It has a 52-week high price of $9.9600 and touched 52 weeks low of $7.170, with an average volume of ~ 853,452.


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