Murray Goulburn Co-operative’s extraordinary shareholder meeting to vote on its $1.3 billion asset sell-off to Canada’s Saputo is still expected next week, despite extended inquiries by the competition watchdog.
The Australian Competition and Consumer Commission says ongoing talks with Saputo Inc have forced it to delay its likely decision date on the sale deal until April 4, the day before MG’s planned general meeting.
The ACCC said the extra two business days of consultation time were needed to allow the regulator to “carefully consider feedback” from current suppliers and customers to MG’s Koroit milk plant.
The ACCC has made clear it wants the factory, just down the road from Saputo’s huge Warrnambool Cheese and Butter plant, sold to a third party to maintain competition in Victoria’s Western District farmgate milk market.
We are working towards an outcome that will promote competition in the long term
The regulator is also still reviewing feedback from other processors and potential purchasers about Saputo’s proposed undertaking to divest the Koroit plant, and continuing discussions with Saputo, too.
“We appreciate this decision will be significant for farmers in the region and assure them we are working towards an outcome that will promote competition in the long term,” an ACCC representative said.
The latest proposed decision date was timed to fall before the planned MG shareholder meeting, which MG said would proceed as planned at Melbourne Convention and Exhibition Centre on April 5 at 11am.
MG, the parent company behind the leading Devondale dairy brand, has noted the ACCC’s extended deadline for its decision and continues to plan for the sale process to go ahead.
Saputo also expects to get the green light from the ACCC and shareholders at next week’s meeting.
The cheese giant’s chief executive Lino Saputo Junior was in an optimistic mood when he met with suppliers to MG this week, also guaranteeing a market leading price per kilogram for milk solids for this season and about $6 by August.
In addition to selling the Koroit factory, Saputo is also expected to offload the co-operative’s 25 MG Trading merchandise stores and six fertiliser depots in Victoria, NSW and Tasmania after it wins control of all the co-op’s assets.