Australia’s GrainCorp Creates New Grains and Edible Oils Business

Australia’s GrainCorp will be spinning off its malting business and integrating its grains and edible oils operations into a new business called New GrainCorp. The proposed demerger would enable both MaltCo and New GrainCorp to pursue independent operating strategies, with discrete capital structures, and attract investors with different priorities. 

New GrainCorp would become a domestic and international grain handling, storage, trading and processing company focused on grains, oilseeds, pulses, edible oils and feeds, with operations in Australia, New Zealand, Ukraine, Asia and North America. “New GrainCorp will operate the largest grain storage, transport and marketing network in eastern Australia as well as Australasia’s largest integrated edible oils business,” GrainCorp said. 

The company said the new business was expected to benefit from a range of initiatives which would increase EBITDA by A$55-80M (US$40-57M)/year, including expanded footprints in Canada, Ukraine, and India; expansion in organics; operational improvements in stock management; grain cost reductions; new rail contracts; and supply chain integration and improved asset utilisation.