I would prefer Bega not to expand into soy and plant based milk products after this sale. For me, it seems like a saturated market at the moment and the money would be best in the bank at this present moment in time. The challenge of delivering a product that lies within the offerings of Coles ($1.15/lt), Sanitarium and Vitasoy doesn't seem worth it if it requires significant CAPEX to start up a new operation closer to the soy producers.
Alternatively BGA can contract Vitasoy to make product under a different label but they would have an inferior brand in this space and likely lower margins that would be chewed up by Vitasoy.
In terms of branding, I think BGA should focus on GoodSport and expand it to liquid high protein breakfast drinks. That would make it interesting.
BGA Price at posting:
$3.98 Sentiment: Hold Disclosure: Held
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