Ruralco's shares rise 45% after takeover offer: ASX closed 0.4% higher

Market Reports

by Rachael Jones

It has been a positive day of trade for the Australian share market closing 0.4 per cent higher. Shares in agribusiness Ruralco (ASX:RHL) are up over 45 per cent today after announcing a buyout by the company Nutrien, more on this later. SEEK (ASX:SEK) announced half year results for the 2019 financial year with net profit falling 5 per cent to 99.3 million, despite this their shares are up almost 9 per cent. Another big riser is telecommunications company Vocus Group (ASX:VOC) their shares rose almost 8 per cent after they announced today it was moving away from consumer NBN. At the closing bell the S&P/ASX 200 index closed 22 points up to finish at 6150.


Dow futures are suggesting a fall of 3 points.
S&P 500 futures are flat.
The Nasdaq futures are eyeing a gain of 1 points.
And the ASX200 futures are eyeing a 19 point rise tomorrow morning

Local economic news

Total construction work done fell 2.6 per cent (in seasonally adjusted terms) in the December quarter, compared to the same time last year, according to the Australian Bureau of Statistics (ABS), while residential works done rose in the quarter by 2.1 per cent.

Company news 

Ruralco (ASX:RHL) announced that Canadian agri-business Nutrien will buy out the company for $4.40 per share by way of scheme of arrangement. The Scheme Consideration values Ruralco’s fully diluted equity at approximately $469 million, and at an enterprise value of $615 million. Ruralco Chairman, Rick Lee says "This will benefit both our farmer customers and their communities.” The deal is still subject to approval from the competition watchdog and the Foreign Investment Review Board. The board expects to receive cash and pay a fully franked special dividend of 90 cents per share and a fully franked interim dividend of 10 cents per share. Shares in Ruralco (ASX:RHL) closed 45.1 per cent higher at $4.44.

SEEK (ASX:SEK) has announced half year results for the 2019 financial year with net profit falling 5 per cent to 99.3 million. Revenue increased 21 per cent to $757.2 million. The company has downgraded its profit guidance for next year due to the cost of increasing investments.

Organic baby food formula business, Bellamy's Australia (ASX:BAL) announced its statutory group profit fell 64 per cent to $8.1 million in the 1H19, compared to the 1H18, on the back of a $12 million one-off inventory provision for rebranding. Nevertheless, Bellamy's group cash rose to $95 million, it has zero debt levels.

Best and worst performers 

The best performing sector was Consumer Staples adding 0.9 per cent while the worst performing sector was Real Estate Investment Trust shedding 0.6 per cent.

The best performing stock in the S&P/ASX 200 was Vocus Group (ASX:VOC), rising 9.97 per cent to close at $3.86. Shares in SEEK (ASX:SEK) and Bingo Industries (ASX:BIN) followed higher.

The worst performing stock in the S&P/ASX 200 was NEXTDC (ASX:NXT), dropping 8.2 per cent to close at $6.50. Shares in Reliance Worldwide corp (ASX:RWC) and Estia Health (ASX:EHE) followed lower.

Asian markets 

Japan’s Nikkei has added 0.5 per cent, Hong Kong’s Hang Seng also added 0.5 per cent and the Shanghai Composite has gained 0.8 per cent.

Commodities and the dollar

Gold is trading at US$1,328 an ounce.
Iron ore price dropped 1.5 per cent to US$86.68
Iron ore futures are eyeing a rise of 0.6 per cent.
Light crude is $0.51 up at US$55.99 barrel.
One Australian dollar is buying 71.89 US cents.


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