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MG Co-operative takeover a step closer

by
April 05, 2018

The proposed takeover of Murray Goulburn Co-operative has cleared another hurdle, with Australia’s competition watchdog approving Saputo’s $1.3billion bid ahead of today’s shareholder vote on the sale.

The approval depends upon MG’s Koroit plant near Warrnambool being divested.

The Australian Competition and Consumer Commission had previously raised concerns about the acquisition of the Koroit plant which would have given the Canadian company control of two-thirds of milk supply in the region, leading to fears it would lessen competition and result in lower milk prices in the region.

United Dairyfarmers of Victoria president Adam Jenkins said for many the sale of Murray Goulburn, which is predicted to be voted through by shareholders today, was the closing of a painful chapter which begun with the 2016 milk price crisis.

‘‘It’s a very sad day for a lot of suppliers who have supplied Murray Goulburn for a long period of time,’’ he said.

‘‘I think most farmers are trying to get clarity and transparency and get on with business ... It’s an opportunity for closure for the industry to move forward and rebuild.’’

If approved, the sale is expected to be finalised by next month, with Saputo chief executive officer Lino Saputo Jr confident the deal will get done.

‘‘This is an important milestone in the process of completing our acquisition of MG. We now await the Foreign Investment Review Board’s (FIBR) decision and the results of the MG shareholder vote,’’ he said.

‘‘We remain confident in our offer and expect to be able to finalise this transaction by May 1, 2018.’’

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