SAPUTO has not given up on its ambition to take over Warrnambool Cheese and Butter (WCB) despite being well short of gaining a controlling stake.
The company on Friday extended the deadline for accepting its offer from 7pm Friday to 7pm on January 22. There will be no further extensions.
The Canadian processor also announced another incremental increase in its holding to 21.4 per cent, up from 20.1 per cent the day before. Saputo chief executive Lino Saputo jnr said the extension was prompted by an increase in the rate of acceptances in recent days.
“We believe that many of the remaining shareholders were waiting until the offer was last and final, so they should accept now,” Mr Saputo said.
“If shareholders want to be paid their cash, and paid quickly, they must accept our offer and make sure we receive their acceptance before the offer expires.”
Saputo is offering shareholders $9 per share, plus increments of 20 cents if it reaches ownership levels of 50, 75 and 90 per cent.
Given the rate of acceptance so far, reaching a controlling interest of more than 50 per cent seems unlikely.
However, there’s little doubt that Saputo’s strategy is to reach a point where buying out one or more of the other major shareholders would take it over the line.
If it were to buy the 18.9 per cent holding of Bega Cheese, it would get over the line with acceptances of just over 31 per cent. The company is known to be seeking Bega’s holding.
Bega executive chairman Barry Irvin told The Standard on Friday his company was in discussions with Saputo, Murray Goulburn and other international interests.
“There is wide interest in Bega’s shareholding and we are considering all options,” he said.
Bega stands to come out the big winner of the bidding war, clearing a profit of $65 million if it sells its stake.
“The waiting and thinking game has worked quite well for us,” Mr Irvin said.
“We’re obviously disappointed that we didn’t achieve our takeover goal, but second prize is pretty good.”
If Bega does cash in its holding, Mr Irvin said there were several development routes the company would consider, with building more processing capability being one of the options.
Murray Goulburn’s rival offer of $9.50 per share is still awaiting approval by the Australian Competition Tribunal, although the co-operative is accepting shares on condition of gaining approval.
Murray Goulburn’s declared holding stands at 17.7 per cent of the register.
(NOTE: Steve Hynes is a WCB shareholder)