According to The Australian Financial Review, GrainCorp Ltd (ASX:GNC) has denied that its proposed merger with fellow grains marketer AWB (ASX:AWB) will result in a monopoly over grain storage and handling operations in the eastern states.
On Friday GrainCorp said the merger would create synergy benefits in excess of $40 million and create the largest diversified rural service business in Australia.
The paper reports Graincorp and AWB would together control 55% of the market and that the NSW Farmers Federal Association has expressed concerns of increased storage, freight and handling fees.
AFR reports GrainCorp corporate affairs manager David Ginns has refuted that the merger will reduce competition and says Graincorp will today outline its case to the Australian Competition and Consumer Commission.
GrainCorp reported a profit of $63.16 million for the year to 30 September 2009.
AWB Price at posting:
$1.10 Sentiment: None Disclosure: Held
