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Dairy Trust Succeeds in Takeover of Open Country Cheese

Friday 19th September 2008

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Dairy Trust, 44% owned by meat processor AFFCO Holdings, succeeded in its takeover offer for Open Country Cheese Co.

The company set up to challenge the milk industry dominance of Fonterra Cooperative Group said it has acceptances for 96.5% of Open Country, allowing it to compulsorily acquire the rest. The offer was due to close tomorrow.

Open Country last traded on the Unlisted market at NZ$2.73 on August 25. Dairy Trust is offering NZ$2.75 apiece for the shares it doesn't already own. The deal also involves Singapore-based agricultural products distributor Olam International, which will become the second-largest shareholder in Dairy Trust.

Dairy Trust plans to help develop dairy processing facilities in the country's four major milk-producing regions, targeting capacity of 1.2 billion litres of milk.

Fonterra, the world's largest diary products exporter, processes more than 90% of milk produced in New Zealand, and Dairy Trust is the only rival with plans to compete in milk processing on a national scale, the companies said.

By Jonathan Underhill

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