Here’s another mention of Bega and general dairy industry update
Apparently Bega not interested due to digesting Koroit Dairy and was also never interested in Capilano for the same reason ....
(So why buy the shares in Capilano?)
“Suitors join forces for Lion’s share”
BRIDGET CARTER
SCOTT MURDOCH
11PM NOVEMBER 21
“Parties vying for Lion Drinks and Dairy are likely to form consortiums in their efforts to secure the operation.
But two groups understood to be going it alone are Saputo and Lactalis.
The French dairy giant Lactalis owns Parmalat in Australia and is understood to be bidding for Lion individually, as is Saputo.
With respect to Bega Cheese, the understanding is that the company may be sitting out the process because it is currently focused on digesting the Koroit milk processing plant that it purchased from Saputo earlier this year for $250 million.
While many expected Bega to also bid for Capilano Honey after buying Vegemite last year, the understanding is that it opted not to pursue the company for the same reason.
This was despite buying a stake in the operation, prompting many to expect that a bid was on its way.
The challenge for both Saputo and Lactalis, though, will be the Australian Competition & Consumer Commission.
Saputo has a dominant presence in the Australian milk and dairy market, while Lactalis is one of the top two players in the industry. The Lion business may sell for as much as
$1.5 billion.
Coca-Cola Amatil will no doubt find a partner, as will Japanese drinks giant Asahi Breweries, which owns Schweppes.
Flyers are out in the market for both Lion and Arnott’s Biscuits, which is also for sale through Goldman Sachs.
Advisers for Lion are Deutsche Bank and Greenhill.
Among the private equity suitors are expected to be Pacific Equity Partners and BGH Capital, among others, while Asian suitors are in the mix.
Market analysts say the portfolio is something of a mixed bag, with the white milk and ambient juices business thought to be challenging.
The yoghurt, fresh juice, flavoured milk and cheese operations are attractive.
The capital raised will fund growth in Lion’s other businesses, including its alcohol and coffee brands, and the group is looking to explore the global high-growth craft beer market.
It will leave Lion with its alcohol operations that span Australia, New Zealand and North America.”
See also :
https://www.farmweekly.com.au/story/5716506/lion-puts-dairy-business-up-for-sale/
“The sale process will focus on finding the right owner to take LDD forward and unlock its full potential,” he said.
.....
But Mr Isozaki’s statement made it clear Kirin had given up on notoriously thin margins in dairy processing to concentrate on chasing a lion’s share of much more lucrative margins in craft beers in the Oceania region.....”
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