Canadian dairy giant Saputo Inc. is up against a rival bid that trumps its own offer in the increasingly hard-fought battle for Australia’s Warrnambool Cheese and Butter Factory Co. Holdings Ltd.
Murray Goulburn Co-operative Co. Ltd. has sweetened its takeover offer for Warrnambool to $470-million (U.S.), a 12.5-per-cent premium to Montreal-based Saputo’s proposal.
Saputo and two Australian dairy companies – Murray Goulburn and Bega Cheese Ltd. – are locked in a bidding war over Warrnambool ever since Bega kicked things off with an offer in September.
Saputo has already increased its offer to about $430-million (Canadian), but it’s not clear at this point if it will move to once again top Murray Goulburn’s bid.
Both Murray Goulburn and Bega own important stakes in Warrnambool but Saputo does not.
Bega said last week it is considering whether or not to sweeten its cash-and-share takeover offer.
Adding a twist to the fight is Japanese beverage giant Kirin Holdings Co.’s recent purchase of a 9.9 per cent position in Warrnambool.
The Saputo offer has the backing of Warrnambool’s board.
Saputo officials did not immediately respond to a request for comment on Wednesday.
“We speculate that Saputo may direct its attention to the Australian Competition Tribunal process being initiated by Murray Goulburn, prior to increasing its own bid for Warrnambool (if necessary),” Desjardins Securities analyst Keith Howlett said in a note Wednesday.