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October 26, 2017

Bega Cheese rules out Murray Goulburn bid but suggests open to acquisitions

Bega Cheese said today (26 October) it is "no longer a potential purchaser'' for troubled Australian dairy cooperative Murray Goulburn, but suggested it may be open to other acquisitions.

By Dean Best

Bega Cheese said today (26 October) it is “no longer a potential purchaser” for troubled Australian dairy cooperative Murray Goulburn, but suggested it may be open to other acquisitions.

Responding to what it called “press speculation”, Bega Cheese also said it had no current plans to raise capital from the market.

In a filing to the Australian stock exchange, Bega chairman Barry Irvin said: “Bega Cheese continues to maintain a strong balance sheet and believes there are a number of potential opportunities in dairy and food.” 

There have been a number of companies reported to be interested in the co-op, either buying assets or taking over the whole company, including Fonterra, Chinese dairy firm Yili, Lactalis-controlled Parmalat and Canada’s Saputo.

Last month, Fonterra reportedly told Australian broadcaster ABC news network the company had been in touch with Murray Goulburn to make an offer.

Also last month, Yili denied stories in the press it had made a bid for Murray Goulburn but admitted after assessing the co-op’s assets it had made a “cautious non-binding strategic development proposal”.

However, the most recent reports out of Australia had touted Bega and Saputo has front-runners.

Murray Goulburn first revealed in August it had attracted interest from unnamed parties considering buying part or all of the embattled dairy group.

The co-op ooked a loss of AUD370m (US$284m) in the year to June. It is set to hold its AGM tomorrow.

During the financial year ended in June, Bega Cheese bought some of the Australian and New Zealand grocery brands from food giant Mondelez International, including its Vegemite spreads business.

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