Bidders for Murray Goulburn have advisers locked down as they focus on the next stage. By: BRIDGET CARTER and SCOTT MURDOCH
Boutique advisory firm Rothschild has apparently won the role advising New Zealand dairy power house Fonterra.
Morgan Stanley has been locked in by Parmalat as its adviser.
Interestingly, Moelis is working for Saputo.
As previously flagged, UBS is with Goodman Fielder, Kidder Williams Bega, Greenhill is working with Lion and Goldman Sachs across the Tasman is aiding A2 Milk.
The roles of the different banks could be viewed as something of an upset in the contest, with Saputo widely tipped to work with Rothschild — the adviser it used some years back in its battle to buy Warrnambool Cheese and Butter — and Moelis Parmalat.
Fonterra was previously thought to have been one of Goldman Sachs’ top clients. Deutsche is running the auction on Murray Goulburn’s behalf.
In the first round, suitors were asked to put in sole bids for all of the company.
It is thought that in the next stage, much of the challenge for suitors, who are likely to form partnerships with other parties, will be to win over the farmers who control Murray Goulburn.
Increasing the milk price to an attractive level in areas where the farmers are based may be more favourable to farmers than receiving a higher price for the company.
Bega Cheese, for instance, may not pay the highest price for the company, but it is well regarded by farmers, which could see it gain the 90 per cent of support needed from Murray Goulburn farmers to make an acquisition.
When co-operative Dairy Farmers was bought by Lion in 2008, the Japanese parent, Kirin Holdings, offered an attractive farmgate milk price for the company as well as an attractive price for the shares.
Some will be attracted to Murray Goulburn’s strong Devondale brand, while others will be eager to get their hands on its two fresh milk facilities that make private label products.
All of Murray Goulburn’s 11 factories produce different products, and it has a facility in China, which may be the area of interest for Burra Foods’ major Chinese shareholder, Fuyang Farming, or China Resources.
As revealed by this column last week, Denmark’s Arla Foods is a bidder for Murray Goulburn, and the theory among analysts is that its interest stems from its desire to diversify geographically and secure a foothold into Asia, with the freight advantages offered by an Australian base.
Source: The Australian