It’s all over. Murray Goulburn unitholders yesterday approved the $1.0 billion takeover of the co-operative by Canada’s Saputo Inc.
The vote now needs the approval of the Victorian Supreme Court and the Foreign Investment review board and the sale of what was Australia’s biggest dairy co-op will be over.
Nearly 98% of Murray Goulburn shareholders voted to approve the sale, it said in a statement. The deal now only requires approval from Australia’s Foreign Investment Review Board.
The sale of Murray Goulburn will end a tumultuous two years for the co-operative that began after an ill-fated partial listing in 2015 and poor management decisions on the pricing of milk – both in purchases from farmers and in deals such as the $1 a litre arrangement with major retailers such as Coles.
It posted record losses after overpaying for milk supplies in order to produce more high margin products such as infant formula and suffering poor Chinese sales.
The backing of shareholders was widely expected after the Australian dairy processor warned last month it would breach its financial covenants if a takeover did not occur, leaving the farmer-owners little choice but to back the deal.
The ACCC approved the Saputo purchase earlier this week after the Canadian dairy giant agreed to a court enforced undertaking to see MG’s Koroit plant in southwestern Victoria to ease competition concerns in the region.
The sale will confirm the dominance of two international dairy giants in Australia (the other is Fonterra of NZ), the world’s third largest dairy exporter. As well global majors such as Nestle and Danone also operate in Australia.