A consortium led by China National Chemical Corp, or ChemChina, has called off talks to buy Australian farm chemicals maker Nufarm Ltd as it was unable to make a formal offer before a deadline.
ChemChina and two US private equity firms, Blackstone and Fox Paine, agreed last month to pay A$3 billion (US$2.8 billion) for Nufarm, which would form the world's largest supplier of generic farm chemicals.
Melbourne-based Nufarm and the consortium had entered into an exclusive deed, under which Nufarm was obliged not to pursue talks with other parties, on November 5. The deed expired at midnight yesterday.
Nufarm said yesterday it has been advised that the consortium would be unable to formalize the proposal before the expiry of the agreement, so discussion between the two parties had ceased.
Nufarm shares slumped 12.08 percent yesterday in Sydney trading, the biggest drop in more than 11 years.
Analysts attributed the buyout withdrawal to the deteriorating debt market. The United States subprime mortgage crisis has made funding for such multi-billion dollar deals increasingly difficult.
Nufarm has said it has been approached by other parties since the ChemChina-led bid.
"Looking forward, we are strongly positioned to generate additional growth from our existing business and to participate actively in industry consolidation opportunities," Nufarm Chairman Kerry Hoggard said in a statement yesterday.
(Shanghai Daily December 11, 2007)
