MACKAY Sugar has formally lodged its $41 a share bid for Tully Sugar, even though US-based agribusiness giant Bunge and China’s state-owned Cofco have already revised their bids higher to $43 a share valuing Tully at $132.9 million.
Mackay’s bid is backed by French-based commodity trader Louis Dreyfus, which has agreed to provide debt funding of up to $102 million to help fund the offer.
Mackay is Australia’s second largest sugar milling company, operating three mills, a refinery, and producing molasses and electricity on the Queensland central coast south of Tully.
At stake is the ownership of one of the last independent grower-owned sugar mills in Australia and other assets including residential properties in the Far North Queensland town.
The Tully mill, whose operation is highly regarded in the industry, has a crushing capacity of 2.5 million tonnes of cane a year and produced 315,000 tonnes of raw sugar in 2002, before production started falling as a result of a series of poor crop seasons.
“By accepting Mackay Sugar’s offer, you are ensuring Tully Sugar’s business remains in Australian hands, managed by a professional grower-controlled company” that has a proven track record of working with growers to deliver higher prices and a more secure and diversified business while investing in the industry,