Bega holds firm on WCB offer

Bega Cheese will not lift its takeover offer for Warrnambool Cheese and Butter (WCB) for now, despite a higher competing bid from Canadian suitor Saputo.

Bega Cheese will not lift its takeover offer for Warrnambool Cheese and Butter (WCB) for now, despite a higher competing bid from Canadian suitor Saputo.

Bega said on Friday that it intends to proceed with its offer to WCB shareholders, but "does not presently intend to increase its offer consideration although it reserves the right to do so".

Bega said its offer of 1.2 Bega shares and $2 in cash, which valued WCB at $360.4 million on October 10, represented excellent value.

Bega said it was comfortable with its present offer to merge with WCB based on its view that a strong Australian-owned and listed dairy company would improve returns for shareholders and dairy farmers.

"Some [WCB] shareholders will prefer to be shareholders of an Australian dairy company and support Bega Cheese's vision for the combined group and the synergies that will come from it," Bega said in a statement to the Australian Securities Exchange.

On October 8, Canadian dairy giant Saputo launched a $390 million takeover bid for WCB, at $7 per WCB share.

Shares in WCB closed up 5¢ at $7.27. Bega shares were 12¢ higher at $3.82.

InvestSMART FORUM: Come and meet the team

We're loading up the van and going on tour from April to June, with events on the NSW central & north coast, the QLD mid-north coast and in Perth, Adelaide, Melbourne, Sydney and Canberra. Come and meet the team and take home simple strategies that you can use to build an investment portfolio to weather any storm. Book your spot here.

Want access to our latest research and new buy ideas?

Start a free 15 day trial and gain access to our research, recommendations and market-beating model portfolios.

Sign up for free

Related Articles