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Saputo bids for Australian dairy company

Saputo Incorporated is making a bid to get into the Australian market. The Canadian dairy company has offered $7.00 (Australian) per share for Warrnambool Cheese and Butter Factory Company Holdings Ltd. The off-market offer is a total cash deal worth $392.7 million Australian ($370.1 mil U.S.). Saputo says the Warrnambool board has unanimously recommended that shareholders accept the offer.

Australia-based Bega Cheese had made a cash-and-share bid worth A$5.75 per share in September. Some expect Bega to make another offer; Bega already holds 18 percent of Warrnambool.

Warrnambool has two operations in Australia employing more than 400 people making products for the domestic and international markets. The company projects earnings of $43.5 to $48 million (U.S.) in the current fiscal year ending June 30, 2014.

With 24 plants, Saputo is the largest dairy processor in Canada and with 26 in the U.S., the second-largest in North America. The company also has operations in Europe and Argentina and sells products in more than 40 countries.