Elders rejects Ruralco offer

Beef Central, 18/06/2013

The board of Elders Limited has this morning announced a decision to reject an offer for its Rural Services Division by Ruralco, stating the offer was 'inadequate with respect to value, execution risk and other considerations'.

However the sale of its Futuris Automotive division appears likely after it announced it will enter negotiations with one of three companies that has made final binding offers for that part of the business. 

Elders Limited made the announcement to the Australian Stock Exchange this morning as its shares returned to trading following a three day halt. Elders shares are currently trading at 8c, down 1c on the level they stood at when the Elders Ltd board announced a trading halt to review sale offers last Friday morning. 

Elders announcement issued this morning reads as follows:

Elders Limited (ASX Code: ELD) has received various proposals in respect to the divestment of its operating businesses Futuris Automotive (Futuris) and Elders Rural Services (ERS).

These were reviewed by the Elders Board over the weekend and yesterday whilst in trading halt.

In relation to Futuris, Elders has entered into a short period of exclusive negotiations with one of the three parties that made final binding offers.

Elders expects that shortly after the conclusion of this period of exclusivity, it will enter into a binding sale contract for the sale of the business.

All proceeds from any sale will be used to repay debt.

In relation to ERS, the Elders Board has determined that the offer made is inadequate with respect to value, execution risk and other considerations. As a result, the Elders Board has determined to reject it.

Elders continues to have the support of its banking syndicate to consider alternative strategies for ERS, including continuing discussions with interested parties and other options for the Company such as restructuring and refinancing alternatives.

Elders will keep the market informed of developments as appropriate.

Meanwhile Elders has requested the ASX lift the trading halt so that its securities recommence trading from the opening of trading this morning.


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