Interest has come from unnamed parties that are not Saputo or Murray Goulburn, Bega says

Interest has come from unnamed parties that are not Saputo or Murray Goulburn, Bega says

Australian dairy processor Bega Cheese has received interest in its stake in local peer and takeover target Warrnambool Cheese and Butter Factory.

Bega is mulling its options for its 18.8% stake in WCB after dropping out of the race to buy the business last month.

The company's decision to pull out of the bidding left Australian dairy co-op Murray Goulburn and Canadian dairy giant Saputo battling to buy WCB, seen as a way of exploiting growing and lucrative dairy markets in Asia.

Industry watchers believe Bega could sell its stake to its two former rivals for WCB. Australian business daily Business Spectator said last week bankers acting for Saputo had contacted Bega to try to buy the stake.

Business Spectator also reported Chinese state investment fund China Investment Corporation was supporting an unnamed Chinese food group that is looking to buy the business.

A report from Reuters, citing an unnamed source, said Bega has been in talks with "non-Australian" suitors.

David Williams, an adviser to Bega from corporate advisory firm Kidder Williams, told just-food he had been contacted about the company's shareholding by suitors but refused to be drawn on their identity.

"Parties other than Saputo and Murray Goulburn have interest in the stake and are talking to me," he said. However, Williams added: "The board of Bega has not met to decide its position."

Murray Goulburn owns 17.7% of WCB, while Saputo has steadily built a stake in the business since it started bidding for the company last autumn. Saputo now holds 17.9% of WCB, although part of the holding is subject to a condition that could see some WCB investors withdraw their acceptance of the Canadian firm's offer.

Saputo offered WCB investors who had accepted its bid before 17 December the right to withdraw their acceptance. The move was part of Saputo's undertakings to Australia's Takeovers Panel after Murray Goulburn complained about one of the company's bids in November.

At present, Saputo has the highest offer on the table. Saputo revised its offer last month after Australia's takeover watchdog accepted the complaint from Murray Goulburn.

Saputo, which had said it would offer A$9.20 a share to WCB investors if it received the backing of over half the company's shareholders, is now offering A$9.40 a share if it wins the support of 75% of stockholders. It will up the bid to A$9.60 a share if it over 90% of investors back the bid.

Murray Goulburn's latest bid values WCB at A$9.50 a share. However, the bid is dependent on approval from Australian competition officials. The Australian Competition Tribunal is scheduled to rule on the offer next month.

Kirin Holdings, the Japanese food and drink giant, is also on the WCB share roster. It acquired a 9.99% stake in WCB through its Australian dairy subsidiary Lion when the bidding war for the business started. WCB manufactures some of Lion's cheese brands, including Cracker Barrel.