Canada's Saputo interested in Westland Milk: report

Westland Milk has 429 farmer-shareholders.  Photo: ODT files
Westland Milk has 429 farmer-shareholders. Photo: ODT files

Canada’s Saputo, which last year bought Australian co-op Murray Goulburn, is reportedly eyeing up Westland Milk.

Saputo was also vying for parts of Australia’s Lion Drinks and Dairy, The Australian newspaper says.

Westland would offer Saputo a stronger foothold in the New Zealand market to take on industry giant Fonterra, the paper said.

Westland, which has 429 farmer-shareholders, was not immediately available for comment on the report.

The Australian said Macquarie Capital was working on the sale.

Westland shareholders heard at last month’s annual meeting in Hokitika that the co-operative’s capital structure review had attracted a number of proposals from interested parties.

More than 25 parties engaged with Westland on the process, the co-op said at the time.

Chairman Pete Morrison told shareholders that on the strength of the indicative proposals, the board will go to the next step of the review process.

“The board will now assess the initial proposals with the intent to move forward with a selected number of parties into a detailed due diligence and final proposal process,” he said at the time.

Shareholders will be updated on the process in March.

Westland is not the only New Zealand dairy co-op to face capital issues.

Fonterra is in the process of reviewing its assets in order to trim its debt, and is looking at selling its Auckland-based Tip Top operation.

This month, the dairy giant announced that it would sell its Farm Source livestock division to Carrfields Livestock - an established livestock agency provider.

Privately-owned Saputo bought Murray Goulburn - Australia’s biggest dairy company - for $A1.31 billion ($NZ1.38 billion).

Several major dairy companies, including Fonterra, had expressed an interest in the Victoria-based dairy group after it ran into financial difficulties.

- By Jamie Gray of the NZ Herald

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