Dairy co-operative Murray Goulburn has announced itself as one of the suitors for the ASX-listed Warrnambool Cheese and Butter as they look at their options after seeing their proposal rejected.
WCB reported in December that they had received and rejected an unsolicited takeover offer in October.
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Just before Christmas, WCB then updated the market with the news that another party had also made a play for the business, while the original suitor had tabled a revised bid.
Both offers were dismissed by WCB, which did not name its suitors.
It has now been confirmed that Murray Goulburn was the original bidder that set the takeover speculation in motion. The co-operative today (29 January) sending a letter to its stakeholders highlighting the opportunity of a merger.
“The MGC board believes the proposal represents a fair price both for WCB shareholders and for MGC and its members. We are currently contemplating our next steps,” chairman Grant Davies said. “At this stage our proposal has not been recommended by the WCB board.
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By GlobalData“However, we believe it is a very attractive proposal for the shareholders and suppliers of WCB. We will continue to seek further engagement with Warrnambool Cheese and Butter’s Board to address any issues or concerns that it may have with our proposal.”
Murray intends to keep the WCB brands and company name, but a deal still appears some way off with any bidder hamstrung by an ownership clause that almost certainly means WCB board approval will be required for any deal to go through. And that could prove difficult to get.
WCB shares were up 4 per cent to $3.38 in early afternoon trade.
