Tuesday, December 18, 2018
 Warrnambool Cheese and Butter Factory "Weeks Away' From Takeover Call  

A packed meeting of more than 400 shareholders and milk suppliers to Victorian dairy processor takeover target, Warrnambool Cheese and Butter factory company, has been warned it may be several weeks before its board makes a final recommendation on which of the three rival offers to accept.

Chairman Terry Richardson told the WCB annual general meeting held October 24, 2013, in Warrnambool that final bidder Murray Goulburn was still to supply adequate detail to allow its offer of $7.50 a share, or $420 million, to be evaluated for shareholder benefit.

Mr Richardson said the earlier unanimous recommendation by WCB's directors to accept the $392m offer from Canadian dairy giant Saputo - rather than the unfriendly $319m takeover bid by Bega Cheese - had been overtaken by the late arrival of fellow Victorian dairy cooperative Murray Goulburn into the three-way bidding war last week.

"The board is still considering Murray Goulburn's takeover proposal and has sought further details," Mr Richardson told eager shareholders attending the AGM.

"The Murray Goulburn offer is above the fair value range [set by WCB advisers KPMG] but is subject to uncertain competition conditions and [they] haven't expressed the same intentions in regard to suppliers, employees, future investment and direction that Saputo has done.

"This process has some time to run and there may still be further developments; but at this stage there is no further information to provide about these offers."

The AGM heard that the 2012-13 financial years had been difficult for WCB, with its export focus afflicted by the low world global prices for dairy products and the high Australian dollar.

At home, a dry season affected the availability and production of milk, with dairy farmers hit by high autumn and winter feed prices and depressed farmgate payments from WCB.

The company reported a "frustrating" 50 percent drop in its after tax net profit from $15.2m the previous year to $7.5m in 2012-13.

Total revenue for the 125-year-old company remained steady at $496m, despite international sales falling by $45m.

The company declared an 11 cent a share dividend payable on its 56 million shares listed on the listed Australian Stock Exchange, less than the previous year but still equivalent to a payout ration of 81 percent of after-tax profits.

Source: The Australian

Posted on Thursday, October 24, 2013 (Archive on Thursday, October 31, 2013)
Posted by bholcomb@adpi.org  Contributed by bholcomb@adpi.org