Open for business? Government stops US food giant's $3.4bn bid for GrainCorp Not for sale ... GrainCorp will stay in Australian hands. AGRICULTURE business GrainCorp has lashed out at the Federal Government's decision to block a $3.4 billion takeover bid from a major US suitor. Treasurer Joe Hockey announced the decision this morning, declaring that Archer Daniels Midland's (ADM) proposal was against the national interest. Federal Treasurer Joe Hockey. The move was immediately criticised by ADM and GrainCorp, with the Opposition suggesting the government had failed its first big test on business matters. Prime Minister Tony Abbott sought to reassure foreign investors that Australia was still "open for business." "We are open for foreign investment but it has to be foreign investment that accords with our overall national interest," he told reporters in Adelaide. However, Grains handler and marketer GrainCorp said it was "extremely disappointed" and warned the decision would have widespread implications for the entire industry. Shares in the company immediately fell after the early announcement in Sydney before markets opened. Mr Hockey said his decision on the $3.4 billion offer was reached after "long and careful" deliberations. "Since coming into government, I've made decisions on a number of foreign investment proposals and those decisions have facilitated a significant amount of new and welcome foreign investment in Australia," he said. Of 131 significant foreign investment applications the government has dealt with, "this is the only application we have prohibited," he said. Junior coalition partner the Nationals and some rural Liberals have opposed the GrainCorp sale. Mr Hockey said the Foreign Investment Review Board (FIRB) was split on the takeover. Not in foreign hands ... GrainCorp is a leader in the agribusiness sector. "The proposed acquisition of GrainCorp has been one of the most complex cases to come before the FIRB and it is one of the most significant proposed acquisitions of an agricultural business in Australia's history," he said. While acknowledging foreign investment had underpinned Australia since settlement, Mr Hockey said members of the FIRB could not agree on a recommendation in relation to the proposal. "For me to reject this proposal, I had to determine that the acquisition of GrainCorp by ADM is contrary to the national interest," he said. Mr Hockey said 85 per cent of eastern Australia's bulk grain exports are handled through GrainCorp's ports network. He said Graincorp owns more than 280 up-country storage sites and seven of the 10 grain port terminals in New South Wales, Queensland and Victoria. Growers in eastern Australia have expressed concern that the acquisition could reduce competition and impede growers' ability to access the grain storage, logistics and distribution network, Mr Hockey said. "Given that the transition towards more robust competition continues and a more competitive network is still emerging, I consider that now is not the right time for a 100 per cent foreign acquisition of this key Australian business," Mr Hockey said. He said allowing the sale to proceed could risk undermining public support for the foreign investment regime. US food giant Archer Daniels Midland has enhanced its takeover offer for GrainCorp with extra commitments. A disappointed ADM chief executive Patricia Woertz said the bid was in the best interests of Australia's grain growers and its economy. "We are confident that our acquisition of GrainCorp would have created value for shareholders of ADM and GrainCorp, as well as grain growers and the Australian economy," she said. Ms Woertz said ADM would work with GrainCorp to maximise the return from its 19.85 per cent stake in the company. National interest ... US bid rejected. Shadow treasurer Chris Bowen hit out at Mr Hockey's decision, saying it demonstrated that the greatest obstacle to foreign investment in Australia was federal cabinet. "This was the first big test for Mr Hockey and his claim that Australia is open for business, and he has failed," he said. The government's business "bravado" has given way to the "reality of an openly-divided and dysfunctional government," he said. However the government was praised by the Australian Greens, who backed the takeover rejection. "Allowing foreign ownership of a monopoly over our grain industry's essential infrastructure is not in the national interest or the interests of growers," the minor party's agriculture spokeswoman Rachel Siewert said in a statement. Agriculture Minister Barnaby Joyce said grain growers were overwhelmingly "dead against" the proposed takeover. Mr Joyce said, when less than one per cent of foreign takeover bids were being rejected, the argument that Australia is not open for business didn't stack up. He said it was important to protect Australia's food security.