FIRB MG decision delay

Delay on FIRB MG decision

Dairy
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FIRB has delayed announcing its decision on the sale of Murray Goulburn to Saputo.

The Foreign Investment Review Board (FIRB) has delayed announcing its decision on the sale of Murray Goulburn’s (MG) assets and liabilities to Canadian dairy giant Saputo.

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In a statement, MG said it had been informed by the FIRB the decision would now not be handed down until April 18.

“Until that approval is given, MG will not be able to finalise the record date for the capital return on its shares and on the units in the MG Unit Trust,” the statement said.

“The indicative record date was 16 April 2018.

“The final record date will now be later in April 2018 and will be notified in due course.”

MG continued to expect the asset sale to Saputo would complete on 1 May 2018 and the initial distribution would be paid within 10 business days of completion.

The FIRB decision is the last regulatory hurdle for Saputo to overcome, in its planned acquisition of MG.

After failing to convince the Australian Competition and Consumer Commission (ACCC) its ownership of MG’s Koroit plant would not be detrimental to farmgate milk competition in western Victoria, Saputo agreed to cull the site.

The Canadian giant already owns Australia’s biggest dairy processing plant, the Warrnambool Cheese and Butter factory, Allansford.

FIRB DECISION: Ari Mervis, Murray Goulburn chief executive said the sale to Saputo meant MG’s assets would be handed over to a “very credible global dairy player."

FIRB DECISION: Ari Mervis, Murray Goulburn chief executive said the sale to Saputo meant MG’s assets would be handed over to a “very credible global dairy player."

Last week, MG shareholders overwhelmingly approved the sale to Saputo.

The final vote saw 97.9 per cent – or 74,036,070 - of all MG shareholders voted for the sale of MG’s assets to Saputo, for $1.31billion.

Only 2.1 per cent of shareholders (1,586,215) voted against the deal, with 97,099 abstaining.

Managing director Ari Mervis said the vote meant MG’s assets would be handed over to a “very credible global dairy player, with a very strong balance sheet, who was very well positioned to continue growing and expanding the business.

“There is clearly a great degree of nostalgia, with regards to the co-operative, and its fully understandable,” Mr Mervis said.

‘While the outcome may not be universally popular, I think if everyone reflects on the requirement for MG for a fresh injection of equity into the business, in order the help it pay a competitive milk price, the solution tabled and the asset sale to Saputo will be in the best interests of all the relevant stakeholders.”

Last week, Saputo chief executive Lino Saputo said the company remained confident in its offer and expected to be able to finalise the transaction, by May 1.

The story FIRB MG decision delay first appeared on Stock & Land.

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