MELBOURN - Louis Dreyfus Co. won’t support Olam Agri Holding’s offer for Namoi Cotton, as the bidding war between the two major agricultural commodities traders for the Australian producer heats up.

LDC, which holds a 17 per cent stake in the Australian producer, would not accept Olam Agri’s offer, it said in a regulatory filing on May 3. LDC and Olam Agri have progressively raised their bids over the last few months.

Olam’s most recent offer on May 2 valued Namoi at A$135.5 million (S$120.6 million), subject to gaining support from more than half of Namoi Cotton’s shareholders. Olam said it would increase that offer if it gets backing from at least 90 per cent of shareholders.

Both companies already have a foothold in Australia’s cotton industry, which is the world’s sixth biggest. Olam owns Queensland Cotton, and has a number of ginning facilities in New South Wales and Queensland states. Meanwhile, LDC owns a cotton business and three processing plants across the country.

Namoi’s shares were trading 1.4 per cent higher in Sydney as of 11.54am, after they surged 13 per cent on May 2. BLOOMBERG