Minter Ellison concludes Warrnambool Cheese and Butter Factory takeover

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Minter Ellison has helped conclude the takeover of Australia’s oldest dairy producer, advising the Warrnambool Cheese and Butter Factory (WCB) after a high profile four-month long process.

An offer from the Canadian dairy company Saputo - represented by Maddocks in Australia and by Stikeman Elliot in Canada-  was accepted, taking its ownership interest in WCB above 75% in a deal worth approximately $530 million.
The two other main competitors - Bega Cheese Limited and Murray Goulburn - were represented by Addisons and Herbert Smith Freehills respectively.
 “As the legal adviser to WCB we were mindful of ensuring that WCB shareholders realised full and certain value for their shares and that the interests of WCB's other stakeholders were appropriately protected,” Minter Ellison partner Tim Watkin said.

In considering various offers the WCB board had to gain approval from multiple regulators, including the ACCC, the Foreign Investment Review Board, the Takeovers Panel, ASIC and the ASX.
The WCB board had publicly favoured Saputo's offer considering it to be superior in terms of an overall comparative assessment of value, conditionality and timing.

However, the WCB board then needed to convince its shareholders and the broader market why it was recommending Saputo’s offer despite the fact that its base offer price was $0.50 less than an offer from Murray Goulburn.  
Saputo’s offer included a three-tiered ownership contingent price structure, which is the first time such an offer had to be considered by an Australian target company’s board.

Saputo offered $9.40 per share, however this price will increase to $9.60 if its ownership stake reaches at least 90%.

“We are delighted to have assisted the WCB board in managing what started as a hostile bid from Bega that then developed into a vigorous auction for control, delivering shareholders an outstanding premium for their shares," Watkin said.