Australian multinational grain trader and processor GrainCorp says that the investment company behind a $1.8 billion bid for the business has withdrawn its offer. However, directors say they will proceed with a company restructure that divests its malting interests.

In December last year, Australian venture capitalist Long-Term Asset Partners (LTAP) made an Aus$2.38 billion ($1.8bn) bid for GrainCorp. GrainCorp operates in the UK as Bairds Malt and the Saxon Agriculture and Scotgrain arable marketing businesses.

At the time, the GrainCorp board said the LTAP offer was just one option of several strategic initiatives it was evaluating over the future shape of the group. Subsequently, in early April this year, GrainCorp revealed plans to demerge its malting activities into a new compay, MaltCo, while retaining its grain, oilseed and pulse trading operations within a simplified business. This could happen by the end of 2019, subject to shareholder approval.

Now LTAP has informed GrainCorp that it is unable to proceed with its original offer.

“GrainCorp engaged extensively with LTAP to assist them as they undertook due diligence and sought to develop a binding offer capable of consideration,” says a company statement. “In parallel, GrainCorp continued to review its portfolio, which thus far has resulted in initiatives including the proposed demerger of the Malt business and the proposed combination of the Grains and Oils businesses with associated simplification and cost reductions.”

For LTAP, chairman Tony Shepherd added: ”Had due diligence supported our operational assumptions, we are confident we would have turned the LTAP proposal into a binding offer as contemplated.”