Dairy company Bega Cheese to sell Victorian sites to fund Vegemite acquisition
Posted
Dairy company Bega Cheese will sell two Victorian facilities for $200 million to help fund its purchase of Vegemite.
The dairy company announced the purchase of Vegemite and other Kraft branded products last month as part of a deal to buy most of the Australian and New Zealand grocery and cheese business from US food giant Mondelez International.
At the time of the acquisition, the company stated it would use bank debt to cover the $460 million cost.
But in a note to the Australian Securities Exchange on Monday night, Bega announced it would sell one of its spray dryers at Tatura and its infant formula finishing plant at Derrimut to Mead Johnson Nutrition to fund the Vegemite purchase.
Bega Cheese has secured a 10-year "service and access agreement" with Mead Johnson for the spray dryer and finishing plant, which means Bega will have continued access to the plants at Tatura and Derrimut for that time.
In a statement, Bega Cheese chief executive officer Paul van Heerwaarden said he was excited to work with Mead Johnson for the next decade.
The transaction is expected to be completed before the end of the financial year.
More to come.
Topics: dairy-production, agribusiness, tatura-3616, port-melbourne-3207, sydney-2000, bega-2550
