GrainCorp to demerge global malting business

Company News

by Rachael Jones

GrainCorp (ASX:GNC) is poised to demerge its global malting business by the end of calendar year 2019.

MaltCo will become an independent ASX-listed company, with shareholders receiving shares in MaltCo proportional to their GrainCorp holding.

On demerger, Mark Palmquist will become Managing Director and CEO of MaltCo.

He will remain CEO of GrainCorp until the demerger; he will resign from his role as Managing Director and step down from GrainCorp Board.

The malt division generated EBITDA of $170 million for GrainCorp last year, but the company believes the asset is not fully valued under its existing structure as drought on the east coast puts downwards pressure on the share price.

Maltco will become the fourth largest independent maltster globally with plants in North America, Australia and the UK.

Shares in GrainCorp (ASX:GNC) are trading 4.3 per cent higher at $9.70