LOUIS Dreyfus Company has again increased its offer for Namoi Cotton after Olam Agri lifted its bid for Australia’s largest cotton ginner last week.

LDC is now offering 67 cents per Namoi, 6c above its inital offer, and 1c above Olam Agri’s offer made on Thursday.

This figure is still lower than Olam Agri’s conditional bid of 70c; however, to achieve this sum, the company would require a relevant interest in at least 90 percent of Namoi shares.

LDC already owns 16.99pc of Namoi shares, and announced on Friday that it would not accept Olam’s offer, a move which has taken 70c off the table.

The tussle for ownership of Namoi Cotton has intensified in recent weeks, after LDC initially looked set to take over the company with its November bid of 51c.

Olam Agri entered the contest in March with a starting offer of 59c, or 57.2c if the transaction occurred off-market.

LDC countered on April 29 with a bid of 60c, with Olam Agri waiting just three days to up its previous offer to 66c.

Today’s offer from LDC is subject to a minimum 50.1pc acceptance condition and receipt of the required regulatory approvals from the ACCC and FIRB.

Unless extended or withdrawn, the offer is valid until 7pm on June 7.

The Australian Competition and Consumer Commission is expected to release its findings into LDC’s proposed acquisition of Namoi on May 16.

All Namoi directors, excluding LDC representative Sarah Scales, agreed to recommend that shareholders accept LDC’s revised bid of 60c per share.

In a release to the ASX, LDC said it sought confirmation from Namoi directors that they intended to continue support for its takeover offer, including the increased bid.

However, the company said “[a]s at the date of this announcement, this confirmation has not yet been received”.

Future under LDC

In an updated bidder’s statement released to the ASX today, LDC detailed its intentions if it is successful in taking over Namoi’s operations.

The statement also confirmed that LDC would seek to compulsorily acquire any Namoi shares if it achieved the threshold of having a relevant interest in at least 90pc of shares, and has acquired at least 75pc of shares.

LDC said it would retain Namoi’s brand name and maintain current operations, as well as promising employees they would retain their current entitlements.

The Namoi board would be reconstituted and all existing directors would be replaced if the offer is accepted.

“The LDC Group values Namoi’s gin network and supporting capability,” the statement said.

“The LDC Group intends to operate all of Namoi’s gins in the normal course and maintain an office in Toowoomba.

“The LDC Group is also committed to continuous improvement initiatives, including supporting Namoi’s existing growth strategy and investing in assets and resources to support the delivery of a competitive service to Australian cotton growers.”

Namoi would also be delisted from the ASX.

 Source: Namoi Cotton