Fresh twist in dairy battle as Fonterra moves on 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.
Frequently Asked Questions about this Article…
Fonterra, a New Zealand dairy heavyweight, is seeking to acquire a 10% stake in Bega Cheese. This move, valued at over $75 million, adds complexity to the ongoing battle for control of Warrnambool Butter and Cheese, where Bega is also a contender.
Fonterra, a New Zealand dairy heavyweight, is seeking to acquire a 10% stake in Bega Cheese. This move, valued at over $75 million, adds complexity to the ongoing battle for control of Warrnambool Butter and Cheese, where Bega is one of the contenders.
Fonterra's interest in acquiring a stake in Bega Cheese is seen as a defensive move to protect its commercial arrangement with Bega. Fonterra leases Bega's cheese brand and supplies products processed in Bega's facilities.
Fonterra's interest in acquiring a stake in Bega Cheese is seen as a defensive move to protect its commercial arrangement with Bega. Fonterra leases Bega's cheese brand and supplies products processed in Bega's facilities.
Fonterra's acquisition of a stake in Bega Cheese is viewed as a strategy to secure an indirect stake in Warrnambool Butter and Cheese, amid the competitive battle for the dairy maker. Bega already holds a 17.9% stake in Warrnambool.
By acquiring a stake in Bega Cheese, Fonterra aims to secure an indirect stake in Warrnambool Butter and Cheese, amidst the competitive battle for the dairy maker. Bega currently holds a 17.9% stake in Warrnambool.
Besides Bega Cheese, other companies involved in the battle for Warrnambool Butter and Cheese include Murray Goulburn, Canada's Saputo, and Kirin, a Japanese-owned company that recently acquired a 10% stake in Warrnambool through its Lion subsidiary.
Besides Bega Cheese, other companies involved in the battle for Warrnambool Butter and Cheese include Murray Goulburn, Canada's Saputo, and Kirin, a Japanese-owned company that recently acquired a 10% stake in Warrnambool through its Lion subsidiary.
Saputo has made an offer of $8 per share for Warrnambool, which the Warrnambool board has backed, pending better offers. Bega has offered $2 cash and 1.2 of its shares, worth $7.29 per Warrnambool share, while Murray Goulburn has offered $7.50 per share in cash.
Saputo has made an offer of $8 per share for Warrnambool, which the Warrnambool board has backed. Bega has offered $2 cash and 1.2 of its shares, worth $7.29 per Warrnambool share, while Murray Goulburn has offered $7.50 per share in cash.
The Australian Competition and Consumer Commission (ACCC) has given the green light for Bega's bid for Warrnambool, stating that there is 'limited overlap' between Bega and Warrnambool in the acquisition of raw milk in certain regions of Victoria.
Yes, the ACCC has given the green light for Bega's bid, stating that there is 'limited overlap' between Bega and Warrnambool in terms of raw milk acquisition in the dairy regions of south-west and northern Victoria.
Kirin's acquisition of a 10% stake in Warrnambool through its Lion subsidiary complicates the takeover efforts by Bega, Murray Goulburn, and Saputo, adding another layer of competition in the battle for the prized dairy group.
The ACCC's approval is significant as it removes a regulatory hurdle for Bega, allowing them to proceed with their efforts to acquire Warrnambool Butter and Cheese without objections from the competition authority.
Fonterra's offer of $4.95 per share for Bega represents a premium over the closing price of $4.41, indicating Fonterra's strong interest in securing a stake in Bega and its strategic importance in the ongoing dairy sector shake-up.
Kirin's acquisition of a 10% stake in Warrnambool through its Lion subsidiary complicates the takeover efforts by Bega, Murray Goulburn, and Saputo, adding another layer of competition in the battle for control of the prized dairy group.
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