SYDNEY, AUSTRALIA: Namoi Cotton Limited has entered into a Scheme Implementation Agreement (SIA) with Louis Dreyfus Company Asia Pte. Ltd. (LDC) to acquire the remaining 83% of issued shares in Namoi that it does not currently own, by way of a scheme of arrangement.
Under the Scheme, Namoi shareholders will receive a total cash consideration of $0.51 per share. This total cash consideration includes Namoi paying a dividend of $0.01 per share to Namoi shareholders on the dividend record date after 1 April 2024 and prior to Scheme implementation.
The total cash consideration of $0.51 per share represents a premium of 44% to the closing share price of $0.355 per share and a premium of 37% to the three-month VWAP of $0.372 per share, in each case prior to the announcement of the NBIO on 28 November 20233.
Namoi is also permitted to pay an additional dividend of $0.01 per share to Namoi shareholders (subject to customary practices) after 31 August 2024 in the event the implementation of the Scheme is delayed beyond that date. This dividend payment, should it be declared, will be in addition to total cash consideration of $0.51 per share under the Scheme.
Tim Watson, Executive Chairman for Namoi, said: “Combining Namoi’s ginning business with LDC is designed to create a strengthened and sustainable business for our grower customers and staff and providing Namoi shareholders the opportunity to realise value for their shares at an attractive premium to the share price prior to the announcement of LDC’s indicative proposal.
“The implementation of the Scheme is expected in mid-2024. Until then the Namoi team will be focused on preparing for and delivering, business as usual, for the forthcoming ginning season to our grower customers. We will also be progressing with the delivery of our obligations to construct and subsequently operate the new gin at Kununurra for the Kimberley Cotton Company.”
Joe Nicosia, LDC’s Head of Cotton, said: “Namoi’s network of cotton gins and the business relationships it has built over the past 62 years are complementary to LDC’s activities, and we strongly believe the move announced today will add value to both entities.
“We intend to retain the Namoi Cotton brand name, operate Namoi gins as in the normal course of business and maintain an office in Toowoomba, and look forward to continuing to deliver a competitive service to our grower customers, as we have done over the past 111 years in Australia.”