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Chinese fertiliser and oil behemoth Sinochem has made a move to buy Australian-head quartered farm chemicals company Nufarm.
Today, Nufarm NZ confirmed speculation that the state-owned Chinese company had approached the Nufarm board in relation to acquiring the company, “on a confidential, preliminary and incomplete basis.”
The company stated that there was no certainty any agreement would be reached or that an offer or proposal would be put to Numfarm shareholders.
The board stated that it would consider any offer or proposal it receives having regard to all alternatives available to the company.
Nufarm said it will keep its shareholders fully informed and a further announcement will be made in the event of any material developments.
Nufarm has manufacturing bases throughout Australia and New Zealand, as well as the Americas, Asia and Europe. It produces a range of crop protection chemicals sold in around 100 countries.
There has been mounting speculation over Sinochem’s approach over recent weeks.
This approach comes a month after Nufarm cut its full year earnings guidance by 15%. The company is expecting a net operating profit of $AU187 million in 2009.
Following confirmation of approach by the Chinese company, share prices climbed 12% before pulling back to $AU10.74 this afternoon.