Just days after Treasurer Joe Hockey blocked the sale of Graincorp (ASX: GNC) to US food giant Archer Daniels Midland (ADM), CEO Alison Watkins has quit and will take up the role of Group Managing Director at Coca-Cola Amatil (ASX: CCL).
Ms Watkins will be replacing long-standing CEO Terry Davis on March 3, 2014, leaving Graincorp at the end of January 2014. Graincorp's CEO said she had intended to leave once ADM assumed control of the company, but given the Foreign Investment Review Board's (FIRB) decision to knock back the $3.4 billion deal, Ms Watkins said that it was best for her to depart right away.
Terry Davis' departure has been flagged by CCA for some time now, officially leaving the company in August next year, after a short period of being available for consultation.
Many commentators had expected the Graincorp/ADM deal to go through, with the Coalition government reaffirming its commitment that Australia was 'open for business' after winning the September election. But the FIRB prohibited the takeover, citing concerns over national interest and control of key infrastructure. Graincorp is Australia's largest listed grains handler, following takeovers of fellow agricultural players Australian Wheat Board (AWB) and ABB Grain in recent times and National Foods several years ago.
Saputo bid dead?
The decision by the FIRB has also cast doubts over the successful takeover of Warrnambool Butter and Cheese Factory (ASX: WCB) by Canadian giant Saputo. On Friday, Saputo had another spanner thrown into the works when the Takeovers Panel told the company to stop buying shares in Warrnambool. Rival bidder, Murray Goulburn is understood to have complained to the Takeovers Panel.
Saputo had amassed a 9.7% stake in Warrnambool, as acceptances to its $9.20 bid rolled in. Warrnambool is also the subject of another takeover bid from rival Bega Cheese (ASX: BGA).
Foolish takeaway
While many have cheered the decision to knock back ADM's bid for Graincorp, some, including the US State Department, have expressed their disappointment, given the United States' US$132 billion in investment projects in Australia to date. Graincorp's shares plunged following the announcement, and are unlikely to see those highs any time soon.
