MONTREAL — Warrnambool Cheese and Butter Factory Company Holdings Ltd. (WCB), the Australian subsidiary of Saputo Inc., has entered into an agreement to acquire the everyday cheese business of Lion-Dairy & Drinks Pty Ltd. based in Victoria, Australia.
The purchase price of C$134.4 million ($107.5 million) includes C$104.1 million that represents the value of inventory net of a minimal amount of assumed liabilities, and is subject to the final determination of the inventory amount and assumed liabilities amount at closing.
Saputo, which holds 87.92% of the shares in WCB, has advised WCB that it will vote its shares in favor of the transaction.
The everyday cheese business operations include cutting and wrapping, distribution, sales and marketing and intellectual property associated with the Coon, Cracker Barrel, Mil Lel and Fred Walker brands. The business generates annual sales of approximately C$156 million ($125 million) and employs approximately 170 people. The cut and wrap operations of the everyday cheese business are located in a building owned by WCB, which is adjacent to WCB’s cheese manufacturing facility at Allansford.Saputo said the transaction will allow WCB to increase its presence in consumer branded everyday cheese products in Australia with strong market positions in this segment, and is consistent with Saputo’s stated strategy to invest in WCB to accelerate its growth in Australia.