SYDNEY: Bega Cheese Limited has entered into a binding Share Sale and Purchase Agreement to acquire all of the shares in Lion Dairy & Drinks (LD&D) for a net acquisition price of $534 million.
Completion of the Acquisition is anticipated to occur at the end of January 20212. The Acquisition will be funded by a combination of new and extended debt facilities and the proceeds from a $401 million underwritten entitlement offer and placement.
Commenting on the Acquisition, Bega Cheese’s Executive Chairman, Barry Irvin, said, “We are delighted to announce this acquisition, which we believe will create significant value for shareholders. The acquisition delivers important industry consolidation and value creation with synergies across the entire supply chain. The expanded product range, manufacturing and distribution infrastructure and brand portfolio realises our ambition of creating a truly great Australian food company.”
LD&D’score business is the manufacture, marketing, sales and distribution of milk based products and beverages. Significantly, LD&D also has Australia’s largest national cold chain distribution network supplying food service and convenience stores. The Company has a national manufacturing footprint comprising13 sites.
Bega Cheese’s Chief Executive Officer, Paul van Heerwaarden, said “we are very pleased with the performance of acquisitions made in recent years which are achieving or exceeding our profit targets. The recent company restructure and ERP implementation will allow us to integrate this Acquisition and take advantage of the various synergies and growth opportunities across domestic and international markets.”
Bega Cheese is advised by Kidder Williams Limited and Addisons Lawyers.
Bega Cheese is undertaking an underwritten capital raising to fund the Acquisition. Bega Cheese will be undertaking a capital raising at an offer price of $4.60 per share to raise approximately $401million and will issue approximately 87 million new fully paid ordinary shares in Bega Cheese.