3 Min Read
By Rod Nickel
Feb 6 (Reuters) - Canada's largest dairy producer Saputo Inc , which recently won control of Australian dairy Warrnambool Cheese and Butter Factory Company, is hungry for further acquisitions in that country, as well as in New Zealand, Brazil and the United States, Chief Executive Lino Saputo Jr. said on Thursday.
Saputo gave no indication that further big purchases are imminent, however, noting that the company had considered a play for Warrnambool for the past 10 years.
"Now with Warrnambool, we have a strong, solid platform in Australia, perhaps there could be other small, tuck-in businesses in Australia," Saputo said on a conference call to discuss quarterly results.
Saputo's shares finished up 79 Canadian cents, or 1.5 percent, at C$52.68 in Toronto.
Saputo won majority control in January of Warrnambool, trumping separate approaches from WCB's two largest shareholders, Australian-based Bega Cheese Ltd and Murray Goulburn Co-operative Co Ltd.
The acquisition expands Saputo's operations beyond Canada, the United States and Argentina, giving it a platform to tap growing Asian demand.
Japanese beverage giant Kirin Holdings Co Ltd, which owns a 10 percent stake in WCB through its local unit Lion, poses the last hurdle for Saputo to take full control of Warrnambool.
CEO Saputo said the company hopes to move beyond 90 percent control by Feb. 12, when its offer for the company is scheduled to close, but if not, he said Warrnambool will be a strong subsidiary of Saputo Inc.
"Whether we have 100 percent or 90 percent or 80 percent, we're still very delighted with this transaction (and) think as a subsidiary, this could be a very good platform for us," Saputo said.
He said the company wants to facilitate some of the plans Warrnambool has long had in place but lacked the finances to execute, and offered a vote of confidence in WCB Chief Executive David Lord.
"I have full confidence that David can manage that division very, very well. With our financial support and perhaps some sales guidance, I think the division can flourish," Saputo said.
For its third quarter, 2014, or the quarter ended Dec. 31, 2013, Saputo's net income rose to C$144.1 million ($129.8 million), or 73 Canadian cents a share, from C$130 million, or 65 Canadian cents, a year earlier.
Revenue jumped 30 percent to C$2.34 billion, factoring in its acquisition of U.S.-based Morningstar Foods in January, 2013.
Analysts were expecting Saputo to earn 74 Canadian cents per share on revenue of C$2.259 billion, according to Thomson Reuters I/B/E/S.