Saputo’s proposed acquisition of Murray Goulburn assets will go ahead after the ACCC gave the deal the tick of approval following its acceptance of a court-enforceable undertaking from Saputo to divest Murray Goulburn’s Koroit plant in southwestern Victoria.
Well, that was no surprise. Saputo, the Canadian dairy hoping to buy Australian co-operative Murray Goulburn, is now looking to sell the dairy factory in southwestern Victoria that is a sticking point to ACCC approval for the $1.1 billion deal.
While Montreal-based Saputo’s $1.3 billion acquisition of distressed rival Murray Goulburn has stalled after the competition regulator revealed concerns over one plant in western Victoria, the obstacle looks easy to overcome – sell the milk plant in question
The hard times (all self-inflicted) continue for Australia’s largest dairy group, Murray Goulburn with the group reporting a net loss for the year to June of $371 million and revealing that the company has fielded some approaches from tyre kickers.
The company has appointed a new CEO and the role will start on February 13 2017. While this addresses part of the management uncertainty, Macquarie believes it will be a while before Ari Mervis is up to speed and influencing the performance of the company.
After overly aggressive forecasts, the company has downgraded its FY16 profit guidance by 36% at the mid point. Morgans is disappointed and notes unit holders are also not impressed by the need to take on additional debt to fund a milk supply support package.
Recent changes to Chinese import regulations under cross border e-commerce have prompted speculation on the impact on MG Unit Trust but Macquarie observes the outcome is still unclear as to which companies will be affected.