Bega Cheese‘s bid to buy Australian dairy peer Warrnambool Cheese and Butter Factory has been declared “neither fair nor reasonable”, according to an independent review commissioned by the takeover target.

KPMG Corporate Finance said WCB shares should be valued at A$6.96 to A$7.49. Bega’s offer – made last month and one of two for WCB – was valued at between A$5.77 and A$6.08 per share. WCB has rejected Bega’s offer. Last week, Canadian dairy group Saputo said it would make an offer worth A$7 a share – and has the backing of the WCB board.

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In a statement, WCB said: “WCB believes the independent expert’s report confirms the board’s view that the Bega offer is highly opportunistic and does not reflect the expected positive impact on earnings from recent business initiatives and improved market conditions. WCB continues to recommend that WCB shareholders reject Bega’s inadequate offer.”

The company said it recommends Saputo’s “superior” all-cash A$7.00-per-share offer, “in the absence of a superior proposal”.

Last week, Bega said it would “fight on” its bid to buy Warrnambool – and cast doubt over whether a rival, higher offer from Canada’s Saputo will prevail.

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Bega Cheese, which already owns 18% of WCB, has said its offer remains on the table and questioned whether Saputo’s offer – which has conditions attached to it – will succeed.

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Saputo’s offer needs to be accepted by investors holding a majority of WCB shares. As well as Bega owning over 18% of WCB, Australian dairy co-op Murray Goulburn holds a stake of over 17%. Bega has suggested securing a majority will be “a tough ask” for Saputo.