The GrainCorp Ltd (ASX: GNC) share price is pushing higher on Friday after a positive development.
At one stage today the grain exporter’s shares were up as much as 8.5% to $8.38. They have since given back some of these gains but are up 6.5% to $8.24 at the time of writing.
Why is the Graincorp share price climbing higher?
Investors have been buying GrainCorp’s shares after the Australian Competition and Consumer Commission (ACCC) announced that it will not oppose the proposed sale of its Australian Bulk Liquid Terminals business to ANZ Terminals.
This follows ANZ Terminals providing a court-enforceable undertaking to divest its Osborne facility in South Australia to a purchaser to be approved by the ACCC.
In addition to this, GrainCorp’s bulk liquid facility at Port Kembla has been excluded from the transaction and will remain part of GrainCorp.
The ACCC said: “The divestment of the Osborne facility and exclusion of the Port Kembla facility alleviate our competition concerns in New South Wales and South Australia, as the competitive structure in these markets will be maintained,”
GrainCorp CEO, Mark Palmquist, was pleased with the ACCC’s decision.
He said: ”We are pleased with the outcome of the ACCC review, which represents a significant step towards completing the sale of our Australian Bulk Liquid Terminals business.”
“In relation to the retention of the Port Kembla Terminal, this terminal is a unique asset, in that it is the only bulk liquid terminal which is co-located in one of GrainCorp’s core grain terminals and operated by Grains terminal staff. It will continue to be an important part of GrainCorp’s grain ports strategy to diversify into non-grain activities and is expected to continue to deliver positive EBITDA results,” he added.
The proposed transaction remains subject to other conditions, including Foreign Investment Review Board approval. But if everything goes to plan, GrainCorp expects the transaction to complete on or around December 31.
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