Japanese beverage giant Kirin Holdings Co.’s purchase of a 9.99-per-cent stake in Australia’s Warrnambool Cheese & Butter Factory reduces the odds that Saputo Inc. will be successful in getting its hands on the Australian dairy company, one analyst says.
The stake acquired by Kirin’s Australian milk processor – Lion – “makes [Saputo’s] bid look increasingly at risk, in our view,” Irene Nattel of RBC Dominion Securities said in a research note Tuesday.
“We now have a situation where three of the milk processors in Australia own a combined 45% of [Warrnambool], suggesting that the domestic players do not want to see a new competitor in the market.”
Montreal-based Saputo recently sweetened its bid for Warrnambool to $8 (Australian) per share and the latter company’s board has recommended shareholders accept it.
Two other Australian companies besides Lion have already made offers for Warrnambool – Murray Goulburn Co-operative and Bega Cheese Ltd. – and Saputo’s attempts at taking control of Warrnambool have triggered nationalist concerns in the country.
Saputo president and chief executive officer Lino Saputo Jr. is in Australia meeting with key Warrnambool stakeholders, said Ms. Nattel.
She said Saputo’s $8-per-share offer for Warrnambool at this point “looks highly unlikely to succeed, and it remains unclear as to whether any price would get the deal done.”Report Typo/Error