Interesting:A2 Milk, Jalna Dairy Foods in spotlight as Saputo...

Interesting:

A2 Milk, Jalna Dairy Foods in spotlight as Saputo goes shopping

https://www.theaustralian.com.au/business/dataroom/a2-milk-jalna-dairy-foods-in-spotlight-as-saputo-goes-shopping/news-story/83a1679faca82f77bc3da33c5abe7625


35 MINUTES AGO JANUARY 24, 2022FACEBOOKTWITTERWHATSAPPEMAILSAVECANADIAN DAIRY GIANT SAPUTO IS SET TO ANNOUNCE A SIZEABLE ACQUISITION TARGET IN AUSTRALIA, AND SOME ARE POINTING TO JALNA DAIRY FOODS OR A2 MILK.JALNA IS ONE OF THE COUNTRY’S BEST-KNOWN GREEK YOGHURT BRANDS AND HAS BEEN FOR SALE THROUGH PWC.HOWEVER, WHILE IT IS A LOGICAL TARGET, IT IS NOT PARTICULARLY LARGE, WITH A TURNOVER OF ABOUT $130M.AS WELL AS THE YOGHURT BUSINESS, WHICH INCLUDES A PLASTICS FACTORY THAT MANUFACTURES YOGHURT TUBS AND LIDS, JALNA ALSO OWNS A 2000 ACRE DAIRY FARM IN NORTHERN VICTORIA, THOUGHT TO BE WORTH ABOUT $12M.A2 MILK HAS A $3.8BN MARKET VALUE, WHICH WOULD BE A LARGE DEAL FOR SAPUTO.SHARES IN A2 MILK HAVE BEEN LANGUISHING SINCE MAY, FOLLOWING A COLLAPSE IN SALES TO CHINA.IT HAS BEEN DISCUSSED AS A TAKEOVER TARGET FOR SOME TIME.HOWEVER, SOME BELIEVE THAT A PURCHASE OF THE BUSINESS WOULD BE A DEPARTURE FROM SAPUTO’S STRATEGY.LIMITED SYNERGIES EXIST, WITH A2 MILK PRODUCING MILK WITH ONLY THE A2 BETA CASEIN PROTEIN.THERE HAS BEEN SPECULATION IN THE PAST YEAR THAT OTHER GROUPS, SUCH AS NESTLE, MAY BE INTERESTED IN A2.THEIR INTEREST IS FOCUSED ON A2’S TECHNOLOGY, WHICH COULD BE TAKEN INTO OTHER SUPPLY CHAINS AND MARKETS.A2 IS CURRENTLY FACING A CLASS ACTION LINKED TO FOUR EARNINGS DOWNGRADES.SAPUTO IS A POWERHOUSE IN THE AUSTRALIAN DAIRY INDUSTRY AFTER BUYING MURRAY GOULBURN AND WARRNAMBOOL CHEESE AND BUTTER.IT THEN ADDED TO THE BUSINESS WITH THE PURCHASE OF LION’S CHEESE UNIT FOR SOME $280M IN 2019.WHILE AN ACQUISITION OF RIVAL BEGA CHEESE WOULD CREATE MANY SYNERGIES, A DEAL IS UNLIKELY TO GAIN CLEARANCE FROM THE AUSTRALIAN COMPETITION & CONSUMER COMMISSION.