Dairy Crest recommends offer from Canada's Saputo
By Oliver Haill
Date: Friday 22 Feb 2019
(Sharecast News) - Dairy Crest directors have recommended a cash takeover bid from Canada's Saputo that values the Cathedral City cheese maker at £975m.
Saputo Dairy UK, an arm of the Montreal-based group, has offered 620p per share, only around 12% higher than the previous day's closing price.
Dairy Crest's shares, which had fallen over 30% in the last two years, shot up 13% to 625p on Friday, suggesting investors anticipate Saputo's bid being challenged.
The board of directors of the FTSE 250 cheese and butter maker felt the terms of the acquisition are "fair and reasonable" and said they unanimously intend to recommend shareholders vote in favour of the deal.
Chairman Stephen Alexander said the offer price "represents compelling value for Dairy Crest shareholders".
He added: "The price premium Saputo is offering reflects Dairy Crest's portfolio of market-leading brands, its manufacturing and innovation capabilities as well as its experienced management team, who will continue to run the business under Saputo's ownership. It is for these reasons that the board is unanimously recommending this transaction to Dairy Crest shareholders."
Lino A Saputo, Jr, chairman and CEO of Saputo Inc, said: "Dairy Crest is an attractive platform for Saputo and fits well within our growth strategy. We believe that under Saputo ownership, Dairy Crest will be able to accelerate its long-term growth and business development potential and provide benefits to Dairy Crest's employees and stakeholders."
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