International dairy company, Saputo Inc, the owner of the former Murray Goulburn Co-operative, has announced that it has entered into an agreement to acquire the specialty cheese business of Lion-Dairy and Drinks, which includes factories in King Island and Burnie, Tasmania for $280 million.
The two manufacturing facilities employ about 400 people.
The purchase price of A$280.0 million, on a cash-free and debt-free basis, will be paid in cash at closing from cash on hand and available credit facilities.
The specialty cheese business produces, markets and distributes a variety of specialty cheeses under a wide portfolio of Australian brands, including South Cape, Tasmanian Heritage, Mersey Valley and King Island Dairy.
For the 12-month period ended on December 31, 2018, the specialty cheese business generated revenues of about $192 million.
The specialty cheese business will enable Saputo’s Dairy Division to further diversify its product offering, adding to and complementing its current activities, the company said.
The transaction is subject to foreign investment approval and clearance by the Australian Competition and Consumer Commission, and is expected to close in the second half of this year.
