Five bid for Dairy Foods

By Graeme Hunt

Friday 8th February 2002

New Zealand Dairy Foods chief executive Peter McClure is not ruling out a Stock Exchange listing once the new owner for food and beverage company is in place.

Five groups from New Zealand and overseas are on the short list for 50% of NZ Dairy Foods and are going through due diligence. Under the Takeovers Code the successful bidder must make the offer available to all shareholders.

Auckland-based NZ Dairy Foods, a subsidiary of Fonterra Co-operative Group, is up for sale as a condition of last year's dairy megamerger. Its wide range of beverages and food products, which includes the Fonterra-licensed Anchor brand, generate revenues of $400 million a year and its sale has attracted interest from around the world.

Mr McClure said there had been 225 potential bids for the company identified after an international roadshow. A New Zealand farmers' group is among the five-member short-list and Australian company National Foods, 18% owned by Fonterra, has been tipped by Australian media as a bidder. It would have to shed its Fonterra shareholding if its bid were to succeed.

Other names bandied about include Parmalat (Italy), Kraft (US) and Nestle (Switzerland). French group Danone has said it is not a bidder.

Mr McClure would not be drawn on the identity or range of bids but said he did not favour a co-operative structure. "We don't want to go down the co-operative route," he said.

He said a new owner might decide to list on the sharemarket.

"I think we would be reasonably attractive to New Zealand investors."

The sale is expected to be completed by the end of May.

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