Canadian dairy giant Saputo won majority control of
Australia's oldest dairy processor after four months of a bitterly contested
takeover battle, with acceptances to its bid creeping over 50%.
Saputo revealed that holders of a further 2.7m shares in Warrnambool
Cheese and Butter Factory had tendered to its bid, lifting its stake from 47.9%
The news comes four months after Australia's Bega Cheese
kicked off the bidding war with a cash and shares offer worth initially Aus$5.78
a share, valuing Warrnambool Cheese and Butter Factory at some Aus$320m.
Saputo's bid, which won approval from the target company's
board, is priced at Aus$9.00 a share in cash – a sum which rises to Aus$9.20 cash
now that the 50% threshold has been reached.
Should Saputo go on to win a stake of more than 75%, the bid
will rise to Aus$9.40 a share, with a maximum Aus$9.60 a share on offer should
Saputo win acceptances from holders of more than 90% of Warrnambool stock.
At that price, Saputo's offer would value Warrnambool's
equity at about Aus$540m.
The crossing of the 50% threshold also triggers an extension
to February 4, from January 22, in the closing period for accepting the bid.
The statement also appears to dash the last chance for Murray
Goulburn, Australia's top dairy exporter, to win control of Warrnambool, for
which it has bid Aus$9.50 a share, but whose offer became ensnared in anti-trust
Advisers to Murray Goulburn - which failed four years ago to
succeed in a Warrnambool bid despite raising its offer three times to
eventually Aus$4.35 a share - have raised the possibility for the co-operative
to remain a minority investor.
The co-operative said on Wednesday that "given Saputo's
offer period is automatically extended for a further 14 days, Murray Goulburn will
now commercially assess this development, including in relation to MG's 17.7%
shareholding in Warrnambool".
Bega sells out
Bega Cheese on Thursday gave up its last hopes of takeover
success, selling its 18.8% stake in Warrnambool to Saputo – for a pre-tax profit
of up to Aus$68.2m at the maximum Aus$9.60-a-share offer price.
Bega said that its board was "conscious of the significant
value of the Warrnambool shareholding, and its obligation to shareholders to
continue to make sensible investment and capital management decisions".
The sale of the stake "is a better financial outcome for Bega
Cheese and its shareholders than a successful takeover at the current bid value".
Bega shares closed on Wednesday in Sydney at Aus$4.80 - some 50% above their level before it made its bid for Warrnambool, a reflection of the capital gains but also including some uplift to account for the potential for the group to become a takeover target as well.
Warrnambool shares closed up 1.2% at Aus$9.42, more than double their price before Bega opened the takeover battle.