Grain handling company GrainCorp Ltd
(ASX:GNC) has decided to exit the merchandise sector by the end of the 2010 financial year and sell a number of its merchandise service centres.
Managing Director Mark Irwin says the decision to wind down the GrainCorp Merchandise business was made after a three month review concluded that the company needed to significantly expand its merchandise operations to become profitable, however did not find any attractive expansion options.
Mr Irwin says the cost of finalising the merchandise operations by September 2010 is estimated at up to $3.5 million after tax.
Mr Irwin says the company expects to be able to sell a number of service centre’s as going concerns over the next six months, and says where an outlet is sold, GrainCorp will work to transition customer accounts and inventory, and where possible staff, to the new owners.
GrainCorp’s profit for the 12 months to September 30, 2009 came to $63.16 million.
