Economy

MG hoses down sale speculation

Murray Goulburn, reeling from an ill-fated Asian expansion, said on August 22 that it was considering approaches from suitors who were interested in buying the cooperative as a whole or some of its assets.

Murray Goulburn has moved to hose down media speculation it has been offered $1.20 per unit for units in the MG Unit Trust.

Up-for-sale Australian dairy processor Murray Goulburn has confirmed it has had approaches from a number of suitors interested in either buying some assets or taking over the whole co-operative.

"Murray Goulburn and its financial advisor Deutsche Bank are engaging with a number of parties to assess their proposals, including valuation", the Australian dairy company said in a statement.

Murray Goulburn - confirmed it has received offers.

While Inner Mongolia Yili Industrial Group has yet to submit a formal approach, the Chinese dairy company said on Thursday it submitted a proposal to Murray Goulburn.

In August, Murray Goulburn reported a $370.8 million loss for the year to June 30 amid plummeting milk supplies.

However, the legacy of Murray Goulburn's foreign expansion is a brand, in Devondale, which is "highly popular in China", according to China information group Red Pulse.

In 2015, Murray Goulburn undertook a capital restructure that involved the establishment of the MG Unit Trust, a special objective funding vehicle listed on the ASX.

Earlier this year, Yili came close to buying United States organic yoghurt producer Stonyfield Farm, with an $850m bid.

Local bidders - which, unlike foreign rivals, would not need approval from Australia's Foreign Investment Review Board - are said to include Bega Cheese. The responsible entity of the MG Unit Trust is MG Responsible Entity, a wholly-owned subsidiary of Murray Goulburn.



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