Ann: Market update, page-51

Bega seems to be back in the bidding here?
In the story above it was suggested it had dropped out but, in a new twist not so surprising given the ever-intriguing, wheeling and dealing world of the food sector, it is reported to have now allied with Japanese brewer/dairy hunter, Asahi breweries.(a quick Google search shows Asahi has been acquiring dairies for more than ten years. Here is a link to its current interest in Lion bhttps://www.aacs.org.au/media/press-release/asahi-shows-rising-interest-in-rivals-local-portfolio/)

And Bega is not only back and stronger than ever but, according to this update in The Australian, from Feb 01, the Lion dairy and drinks unit will be chopped up after all.
https://www.theaustralian.com.au/bu...e/news-story/ad97b51c9e4b7029f288c96b8b852a02



“Lion Dairy & Drinks deal split to allow separate cheese sale

• BRIDGET CARTER! SCOTT MURDOCH

• FEBRUARY 01, 2018

• The sales process for the Lion Dairy & Drinks business appears to have taken an interesting turn, with the offering now split into two separate components.

Now for sale separately from the drinks arm is the cheese division — deemed to be the more lucrative part of the portfolio.

It is understood that the plan was initially to sell the $1 billion-plus portfolio in one line through advisers working on the transaction, Deutsche Bank and Greenhill.

However, the most attractive part of the operation is the cheese division, which counts brands including South Cape, King Island Dairy and Tasmanian Heritage.

Lucrative offers for that part of the business have prompted the company to consider selling that operation separately.

However, those hoping that the flavoured milk and juice operations can be isolated from the
less-popular fresh milk component will be disappointed, as all of those will be sold collectively.

Offers have been received by parties for the cheese division and the drinks division separately, while some suitors have also put forward bids for the business as a whole.

One of the groups thought to be eyeing the cheese operations is Murray Goulburn and Warrnambool Cheese & Butter owner Saputo, which is believed to also be working overtime to try to buy Westland Milk Products in New Zealand.

It counts Moelis as its adviser.

The understanding is that as the competition progresses to the next stage, the flavoured milk and juices division remain strongly within the sights of Coca-Cola Amatil.

Japan’s Asahi Breweries is also vying for the drinks operation in a Rothschild-advised partnership with Bega. Bega, advised by Kidder Williams, may also take the fresh milk component.

Meanwhile, Coca-Cola Amatil’s results will be closely watched during reporting season this month as Australian beverages remain susceptible to a number of headwinds.

The company had earlier flagged that 2019 would be another transitional year, and expectations are mounting that further funds will need to be spent to meet growth targets.

Macquarie predicts that the company will need to spend between $10 million and $20m annually over three years, with earnings before interest and tax expected to be $377.3m — 8.5 per cent lower than the previous corresponding year.
Compounding problems for the listed bottler is that its Indonesian operations, which accounts for about 14 per cent of its overall earnings, do not appear to be staging an improvement.

Macquarie predicts that they will probably hit about $90.2m for the 2018 fiscal year, down 0.7 per cent on the previous corresponding period, implying 3 per cent volume declines.”