The shake-up in the dairy sector took a fresh twist late on Thursday with New Zealand heavyweight Fonterra seeking to acquire a 10 per cent stake in Bega Cheese.
The defensive move, valued at more than $75 million, adds to the intrigue in the three-way fight for control of Warrnambool Butter and Cheese, given Bega remains one of the suitors with a live bid on the table for the producer.
Goldman Sachs on Thursday was seeking a 10 per cent stake in Bega on behalf of client Fonterra. The broker was understood to be offering $4.95 a share, a premium on the closing price of $4.41.
Analysts said the Fonterra move was aimed at protecting its commercial arrangement with Bega. Fonterra effectively leases Bega's cheese brand, with the New Zealand major supplying some products processed in Bega's facilities.
The move is also seen as a way for Fonterra to secure an indirect stake in WCB amid the hotly-contested battle for the dairy maker. Bega has a 17.9 per cent stake in Warrnambool.
It comes days after Japanese-owned brewer and dairy company Kirin bought a 10 per cent stake in WCB through its Lion subsidiary, complicating efforts by Bega, Murray Goulburn and Canada's Saputo to take over the prized dairy group.
The Warrnambool board has unanimously backed an offer by Saputo of $8 a share, pending any better offers. It has so far shunned earlier bids by Bega and Murray Goulburn. Bega has offered $2 cash and 1.2 of its shares, worth $7.29, per Warrnambool share. Murray Goulburn has offered $7.50 a share in cash.
The development came as the Australian Competition and Consumer Commission gave the green light for Bega's bid. In a note to Warrnambool shareholders, Bega said the ACCC would "not object" to its efforts to acquire the group.
The ACCC said there was "limited overlap" between Bega and WCB in relation to the acquisition of raw milk in the dairy region in south-west Victoria and areas of northern Victoria.