Who wants to buy an Australian manufacturer?

Comment by Peter Roberts

Everyone seems to want to buy Australia’s iconic manufacturers – except Australians it seems.

Despite a multi-trillion dollar superannuation nest egg built up by working Australians, why is it so often only foreign interests that can see value in our manufacturers?

Just this past week Arnott’s biscuits, part of Campbell Soup Co’s international brands division, was sold to investment powerhouse KKR for around $3.15 billion.

The week before, CUB (Carlton & United Breweries), was sold to Japan’s Asahi for $16 billion.

In both cases the purchasers bought from other foreign owners, underlining the interest foreign groups have in our under-valued manufacturers. They are lining up to have a go.

Both CUB and Arnott’s are once-great companies which faltered under local ownership, but which have faded further in foreign ownership.

Beer drinkers are deserting big brands for craft beers, and Arnott’s had moved from everyday treat to ‘who needs it’ category in the average household shop.

Perhaps Asahi will make a go of CUB, which once dominated the local beverage sector, but it seems unlikely KKR is interested in anything more than turning over the asset having stripped it of value and made it look good for re-sale.

Just where is our much-vaunted local capital sector?

The financial services sector is bigger than mining or manufacturing, but how much value is this bloated entitlement of Macquarie millionaires adding to the economy?

The banks and fellow travellers hold considerable sway with policy makers in Canberra, but where were they when assets like CUB and Arnott’s went a’begging?

Sure there have been occasional moves in the reverse such as Bega’s purchase of Kraft spreads from Mondalez International.

And yes, there are small wins such as Robern Menz’s purchase of Violet Crumble and Polly Waffle chocolate bars from Nestle, as reported in @AuManufacturing news.

But surely there is something wrong when Australian interests cannot outbid KKR.

After all this is a company so scatter gun in its interests, so focused on ‘shine’ém up and sell them off’ that it also owns stakes in laser hair removal business Laser Clinics Australia, healthcare business GenesisCare and lender Pepper Group?

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