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MGC

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43.0¢ mg unit trust

Takeover deal, page-3

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bunjil

16 Posts.

11/10/17

16:12

Post #: 27830004
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Originally posted by alfred137 ↑

Just wanna create a new thread for everyone to discuss the potential takeover deal.

My opinion: Taking over MGC is not easy, takeover by foreign investors is much harder.
1. As MGC is still the largest dairy company in Australia, FIRB may not approve foreign companies`s offer due to strategic or other reasons;
2. Most of us already know MGC`s tricky capital structure, and i believe all the bidders know for sure. If they still submitted the offer, they must be confident that they can get 90% of the vote from dairy farmers.
3. It all comes down to MGC`s intrinsic value. Great access to largest group of dairy farmers in Australia, established channel to retailers and consumers, Devondale, the most valuable asset and brand in MGC, contributed about $500m revenue last FY.

All in all, I believe $1.2 offer from Yili group is fair and reasonable and farmers will take it very serious as it represent 20% premium on farmers` initial share; very likely that the offer is a strategic investment，rather than a takeover offer.

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the 1.2 per share is cheap, does not reflect the brand value at all. but considering the current trouble of losing milk intake, they may reach some agreements. I would like to see MGC can still run as a stand alone entity with some commitments from overseas investor

MGC Price at posting: 87.0¢ Sentiment: Hold Disclosure: Held
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