Milking it: Goodman Fielder eyes Murray Goulburn [IMG] For any...

Milking it: Goodman Fielder eyes Murray Goulburn
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For any takeover to progress, 90 per cent of Murray Goulburn's shareholders need to vote in favour. Mark Jesser

• by
• Sarah Thompson
• Anthony Macdonald
• Joyce Moullakis

Goodman Fielder's new owners, Singapore oils trader Wilmar International and Hong Kong investment company First Pacific, have been focused on cutting costs and closing plants since outlaying $1.3 billion for the breads and spreads maker more than two years ago.
However, sooner or later the focus was bound to return to growth and the primary rationale for their original investment in Goodman Fielder. That is, to take the consumer food giant's brands to Asia by leveraging Wilmar's extensive distribution footprint in the region and First Pacific's 50 per cent stake in Indonesia's largest food company, Indofood.
It is understood Goodman Fielder, Wilmar and First Pacific are now running the rule over the nation's largest dairy processor, Murray Goulburn, which kicked off a strategic review in June and has recently received approaches from third-parties, including takeover offers.
Chief executive Ari Mervis revealed last month that Murray Goulburn had received a number of "confidential and unsolicited indicative proposals from third parties" since he announced the strategic review three months ago.

Street Talk understands several parties have signed confidentiality agreements as adviser Deutsche Bank looks at a gamut of options from joint ventures to full bids.

The most obvious buyers and joint venture partners are Parmalat Australia, Bega Cheese, Fonterra or Canada's Saputo, which owns Warrnambool Cheese & Butter.
However, an offer or partnership with Goodman Fielder cannot be ruled out even though some industry players believe the maker of Helgas and Wonder White Bread, Meadow Lea spreads and Praise mayonnaise is finding Australian and New Zealand food market conditions tough.
A partnership or acquisition of Murray Goulburn would enable Goodman Fielder to build a sizeable dairy business in Australia to match that in New Zealand, where Goodman owns leading brands such as Meadow Fresh milk, Chesdale cheese, Puhoi Valley cheese and yoghurt and Tararua Dairy Co dips.
It would give Goodman a new local source of milk and shore up supplies in the event that its supply agreement with Fonterra comes to an end.

Goodman started exporting Meadow Fresh UHT milk to Asian supermarkets soon after the drawn out takeover bid from Wilmar and First Pacific was completed in early 2015.
Should Goodman's plans for Murray Goulburn progress. it is understood investment bank UBS is on hand to provide counsel. Goodman, Wilmar and First Pacific declined to comment.