Bega Cheese has greatly expanded its manufacturing and brand footprint in the food and beverage sector with the purchase of Lion Dairy & Drinks for $534 million.
Bega will take over the business at the end of January 2021, adding to its cheese and spreads businesses numerous milk drinks, yoghurt, cream, and fresh juice brands.
The company will fund the buy with debt and a $401 million underwritten entitlement offer and share placement.
Bega Cheese Executive Chairman, Barry Irvin, said: “The acquisition delivers important industry consolidation and value creation with synergies across the entire supply chain.
“The expanded product range, manufacturing and distribution infrastructure and brand portfolio realises our ambition of creating a truly great Australian food company.”
LD&D’s brands include Dare, Farmers Union, Big M, Masters, Dairy Farmers, Yoplait, Juice Brothers, Daily Juice, Pura and Masters.
The combined large-scale dairy and foods business is expected to generate revenue in excess of $3 billion.
Bega has been on an expansion drive in recent times, in 2017 buying Mondalez’s Australia and NZ food and grocery businesses including Kraft Vegemite and peanut butter for $460 million.
Bega Cheese’s Chief Executive Officer Paul van Heerwaarden said: “We are very pleased with the performance of acquisitions made in recent years which are achieving or exceeding our profit targets.
“The recent company restructure and ERP implementation will allow us to integrate this Acquisition and take advantage of the various synergies and growth opportunities across domestic and international markets.”
Picture: Lion Dairy and Drinks
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