CSR: sells sugar operations to Wilmar International

North Ryde / AU. (csr) Australian CSR Limited announced that it has agreed to sell its Sugar and Renewable Energy business Sucrogen to Wilmar International Limited (Singapore) for an enterprise value of 1’750 million AUD (1’472 million USD) excluding minority interests, comprising 1’347 million AUD (1’133 million USD) in equity, and 403 million AUD (339 million USD) of net debt, as at 31 March 2010, subject to certain completion adjustments.

Completion of this transaction is expected to take place around 30 September or shortly thereafter, and is subject to approval from Australia´s Foreign Investment Review Board and New Zealand´s Overseas Investment Office, as well as other customary sale conditions. The effective date of acquisition is 01 April 2010, subject to completion taking place, and accordingly, the transaction is expected to be earnings accretive from the first year of consolidation. Funding for this acquisition will be from internal sources of funds and bank borrowings.

CSR Chairman, Dr Ian Blackburne: «The sale of Sucrogen to Wilmar achieves CSR´s objective of separating its two very different operating businesses. We have been working towards this objective for some time and having explored a number of strategic alternatives, the Board believes a sale to Wilmar is in the best interests of shareholders and stakeholders in CSR».

CSR Managing Director, Jeremy Sutcliffe: «The sale price of 1,75 billion AUD is an attractive valuation and will deliver significant value to CSR shareholders. Wilmar is one of the region´s largest listed agribusinesses, with a market capitalisation of approximately 31 billion AUD. The sale will enable Sucrogen to develop its globally cost competitive position in raw sugar milling, together with its market leading positions in refining and renewable energy, as part of a world-leading agribusiness group. Following the sale, CSR can focus on growing its building products business, which already has significant leverage to the Australia/New Zealand residential and commercial construction industries, combined with a strategic investment in a globally cost competitive aluminium smelter».

Wilmar´s Chairman and CEO, Kuok Khoon Hong: «We would like to warmly welcome our new Sucrogen colleagues to the Wilmar family. Sucrogen has a good strategic fit with Wilmar´s existing portfolio of high quality, processed agri-products. Wilmar will work with Sucrogen´s management to create synergies and to pursue growth strategies in Indonesia and other high potential Asian markets, utilising Sucrogen´s proven expertise across the entire sugar value chain and market-leading position in Australia. Wilmar also recognises the extremely important role of all stakeholders in the Australian industry who helped build Sucrogen´s success».

Info 01: Agreement to sell Sucrogen for A$1.75 billion to Wilmar International Limited – CSR´s complete press release (PDF).

Info 02: Wilmar International Limited acquires CSR Limited’s Sugar and Renewable Energy business, Sucrogen Limited – Wilmar´s complete press release (PDF).