SYDNEY, Dec 17 (Reuters) - Saputo Inc has agreed to raise its bid for Australia’s Warrnambool Cheese and Butter Factory Holdings Co, dependent on acceptances, and extend the offer period following a rap over the knuckles from the country’s takeover regulator.
The Takeovers Panel said on Tuesday that complex changes to the Canadian dairy company’s agreed offer for Warrnambool were “most undesirable” and “caused confusion and disruption in the market for Warrnambool shares.”
However, it stopped short of issuing a so-called “declaration of unacceptable circumstances,” which could have nixed Saputo’s sweetened offer, and instead accepted key changes to the bid by Saputo and Warrnambool.
Saputo last month declared its bid unconditional and said it would hike the offer from A$9.00 to A$9.20 in cash if it won more than 50 percent acceptances. Under the agreement with the panel, that now rises to A$9.40 with 75 percent acceptances and A$9.60 with 90 percent acceptances. Saputo also declared the offer final, meaning it cannot make further changes.
Saputo, which is in a three-way battle with Australian rivals Murray Goulburn Co-operative Co Ltd and Bega Cheese Ltd for Australia’s oldest dairy company, also agreed to extend the offer period from Dec. 20 to Jan. 10.
The Takeovers Panel put Saputo’s A$515 million bid on hold on Nov. 29, ruling that it must stop processing acceptances for its offer, after complaints from Murray Goulburn and Bega that its most recent bid was misleading.
Warrnambool had announced it intended to declare special dividends if Saputo’s bid reached certain thresholds, while Saputo announced accepting shareholders would be able to receive part of their consideration in the form of franked dividends. Those plans were revoked on Nov. 25.