E-Malt.com News article: 2291

Australia's ABB Grain acquires grain packing firm, Asia Pulse revealed on March 5. The sale included a $A3.85 million ($US2.88 million) cash payment and the issue of $A250,000 ($US187,112.5) worth of ABB B-Class shares.
ABB managing director Michael Iwaniw said the acquisition of the Melbourne-based ProGrain was in line with ABB's focus on expanding its core business.

Earlier this week ABB called off merger talks for the third time with rival grain company AusBulk Ltd saying despite merger synergies of up to $A10 million ($US7.48 million), the companies were unable to agree on each other's company valuations and there was no chance they would ever join together.

Mr Iwaniw said ProGrain's operations were expected to make a positive contribution to ABBs 2004 financial year results, and its 2004 forecast net profit which prior to the acquisition was $A18 ($US13.47)- $A19 million ($US14.22 million).
"ProGrain is widely recognised as a provider of top quality service to its customers and it is this reputation, earned over many years, that attracted ABB to the company," Mr Iwaniw said.

ProGrain is a specialist grain cleaning and packing company which receives grain and prepares it for export.
Mr Iwaniw said exporting packaged grain was a steadily growing market.

"Further, this will aid in securing efficiency gains in the supply chain for customers, with the benefits flowing on through grower returns," he said.

ProGrain founder Mr Norm Lee said the sale to ABB would assist the growth of ProGrain.

"The financial and overall security and resources afforded by ABBs ownership will enable further expansion and improvement of ProGrains existing services, as well as entry into new fields," Mr Lee said.

Under the deal Mr Lee would continue to manage the company under its current name.

The operations of ProGrain include loading both bulk grain and bagged grain in shipping containers for export, as well as providing a full range of grain cleaning, grading and bagging facilities.

The company handles a full range of cereals, pulses, oilseeds, meals and various other commodities, as well has having facilities to store significant volumes of grain.



05 March, 2004