December 17, 2013 - 5:13 AM
MONTREAL - Saputo Inc. (TSX:SAP) says it's willing to pay substantially more for Warrnambool Cheese and Butter if it can get as much as 90 per cent of the Australian company's stock.
The Montreal-based company is maintaining its base offer at AU$9 per share if it doesn't acquire a majority of WCB's stock but says it will pay as much as AU$9.60 cash per share under certain circumstances.
Saputo maintained its offer os AU$9.20 per share if it gets a simple majority, a condition included in the previous bid. However, it added that it will pay AU$9.40 per share if it gets 75 per cent of the total and AU$9.60 per share if it gets at least 90 per cent of WCB's stock.
The offer values Warrnambool at up to AU$537 million or about C$510.1 million (US$480 million) at current exchange rates, if Saputo pays the maximum.
Saputo has extended the deadline for its offer to Jan. 10.
The company has faced stiff competition for Warrnambool, which would provide Saputo with an entry into the Australian market and a toehold in the Asia-Pacific region.
Rival Murray Goulburn Co-operative had applied to the Australian Takeovers Panel to block Saputo's efforts for up to two months.
It alleged that Warrnambool's shares traded for a period in November based on "misinformation as to the terms of the Saputo bid'' because of Warrnambool's decision to no longer pay up to AU$1.31 per share in special dividends.
That means shareholders can't access 56 cents per share in "franking" or tax credits from Saputo's earlier offer.
The panel issued a ruling Tuesday that agreed that the two announcements from Saputo and WCB amounted to a change from the previous offer that included a special dividend.
However, the takeovers panel said it "declined to make a declaration of unacceptable circumstances" if the two companies agreed to certain undertakings.
Those undertakings included a higher offer from Saputo, an extension to the deadline date and the offer of withdrawal rights to Warrnambool shareholders.
News from © The Canadian Press, 2013