AGRIBUSINESS and automotive interiors supplier Elders wants to sell its biggest business unit, its rural services business, before someone tries to take it over.
Elders said on Monday that it would start a sales process for the rural services division as part of an accelerating strategy to return value to shareholders.
Elders also said it was in talks with its bankers about refinancing.
Elders chief executive Malcolm Jackman said it was inevitable that, sooner or later, some other company would try to snatch the rural services division from Elders.
Earlier this month, Ruralco Holdings made overtures to Elders to discuss a possible merger between the two agribusinesses, but no formal proposal has been put on the table.
Mr Jackman also pointed to US-based food processing giant Archer Daniels Midland Company's (ADM) proposed $2.68 billion takeover of Australian grains marketer GrainCorp.
"Given the fact that we've got a lot of interest in the agricultural sector at the moment - we've got people approaching us - the board has asked: Should we just be waiting for people to come knocking on the door, or should we take charge of the process?" Mr Jackman told AAP.
"That (the sales process) is being done with the full support of our banking syndicate which we've been in discussions with anyway given the fact that we've got (debt) maturities at the end of the year."
Elders is already exiting its forestry assets and has put its automotive interiors business up for sale.
Mr Jackman acknowledged that if rural services were sold, Elders would have few assets left, and he could not say if Elders would continue thereafter as a publicly-listed company.
But the Elders name would continue because it was among the best known brands in the agricultural sector.
Ruralco, which is the largest shareholder in Elders, said on Monday that Ruralco was disappointed that Elders was selling its rural services and automotive divisions while it was in talks with its bankers about refinancing.
"However, the sale of Elders Rural Services creates opportunities for Ruralco," Ruralco said.
"Ruralco can potentially generate material synergies from an acquisition of Elders Rural Services."
Mr Jackman said it was hoped that Elders could invite indicative bids early in the new year.
Any sale would be subject to a shareholder vote.
Commonwealth Bank agricultural analyst Jordan Rogers said Ruralco's recent approach to Elders had likely prompted Elders to try to flush out other interested parties.
In a recent research note, Mr Rogers estimated the takeover value of Elders' rural services business at $268 million to $350 million.
Mr Rogers had said that Ruralco had already showed its intention to be part of a break-up of Elders and international interest could follow.
Elders' rural services division - which sells chemicals, fertiliser, farm supplies, livestock, wool and real estate - generated underlying earnings of $21.1 million in the six months to March 31, 2012.
Shares in Elders were one cent lower at 24.5 cents on Monday.
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