Murray Goulburn lifts stake in dairy rival Warrnambool Cheese and Butter, which sells milk under the Sungold brand.

Close×

Murray Goulburn boosts investment in dairy rival

18 April 2013

Murray Goulburn Co-operative has lifted its stake in its competitor Warrnambool Cheese and Butter (WCB) to 14.5 per cent in a move described by the company as a strategic investment.

However, Murray Goulburn (MG) has denied the $5.5 million investment in an additional 1.2 million shares was in preparation for a takeover offer.

The company previously owned 12 per cent of WCB - its smaller listed rival - and Murray Goulburn managing director Gary Helou said the acquisition of the additional shares was “a reconfirmation of Murray Goulburn’s commitment to its long-term investment in WCB”.

“This is a strategic investment and there is no current intention to make a takeover offer for WCB, nor do we currently intend to seek Board representation,” he said in a statement.

Murray Goulburn has also announced it is willing for a limited period of time to acquire additional shares in WCB at the same price of $4.60 per share.

“There is however no assurance MG will acquire any further shares in WCB. MG is satisfied with its 14.5% stake,” the company said.

The maximum MG can acquire under the Corporations Act consistent without making a takeover offer, however, is 19.9 per cent of WCB.