GrainCorp wildcard
The free-trade agreement issue is believed to have surfaced last week, and it appears to increase the pressure on the government to wave the takeover through.
It commits the government to advise the US government if there are concerns about a US takeover bid for an Australian company, to give the US the option of opening up direct government-to-government talks, and to allow "sufficient time" for it to do so.
The deadline for a decision on Archer Daniels Midland's bid for GrainCorp was extended to December 17 in October by the Treasurer, Joe Hockey, and is now three weeks away.
Hockey hinted on Thursday, however, that the decision is close, saying it was "not too far off".
He cited the size and complexity of the takeover when he gave himself more time, but by October it was already clear that the Coalition was divided about the takeover proposal.
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Frequently Asked Questions about this Article…
The free-trade agreement with the United States includes a side deal that requires the Australian government to inform the US if there are concerns about a US takeover bid for an Australian company. This adds pressure on the government to approve Archer Daniels Midland's $3.4 billion takeover offer for GrainCorp.
The decision deadline was extended to December 17 by Treasurer Joe Hockey due to the size and complexity of the takeover. This extension allows more time to address the divisions within the Coalition regarding the proposal.
The free-trade agreement allows the US government to open direct talks with the Australian government if there are concerns about a US company's takeover bid, ensuring that both governments have sufficient time to discuss and resolve any issues.
Joe Hockey, the Treasurer, is responsible for making the final decision on Archer Daniels Midland's takeover bid for GrainCorp. He extended the decision deadline to ensure thorough consideration of the proposal.
The Coalition is divided due to differing opinions on the impact of the takeover on Australia's grain industry and the potential influence of a US company on a major Australian grain handler.
Archer Daniels Midland has made a $3.4 billion takeover offer for GrainCorp, which is the largest grain handler in eastern Australia.
According to Treasurer Joe Hockey, the decision on the takeover bid is 'not too far off,' indicating that it could be made before the extended deadline of December 17.
The takeover could significantly impact the Australian grain industry by potentially increasing US influence over a major grain handler, which is a point of contention within the Australian government.
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