Italy’s Parmalat SpAPLT.MI +0.16% is in discussions to acquire Australian beverage and dairy products maker Harvey Fresh (1994) Ltd. in a deal worth more than 100 million Australian dollars (US$94 million), according to a person familiar with the matter.
Talks between the two companies are not yet exclusive, the person said. Any deal will boost the contribution of the Australian region to Parmalat’s overall earnings before interest, tax, depreciation and amortization, or Ebitda. In 2012, 7.8% of Parmalat’s global Ebitda was derived from Australia, a 0.4% lift on 2011, from brands including Pauls milk and custard, Vaalia yoghurt and flavored milks Breaka and Rush.
Harvey Fresh, which makes milk, wine and juice, is based in Australia’s Western Australia state. The company exports its beverages, and other products like cheese and yoghurt, to countries including China, Indonesia and Malaysia, according to its website.
Parmalat’s controlling shareholder, French dairy company Groupe Lactalis, has also been on the acquisition trail in Australia. In late 2012, Lactalis acquired gourmet cheesemaker Jindi, which competes against Japan’s Kirin Holdings Co.’s2503.TO -0.46% Australian unit Lion Co.’s King Island Dairy brand.
Parmalat’s interest in Harvey Fresh comes as a three-way bidding war for Australia-listed Warrnambool Cheese & Butter Factory Co.WCB.AU +2.09% heats up. Canada’s Saputo Inc.SAP.T +0.78% on Friday sweetened its all-cash takeover offer to A$9.00 a share, though shares in Warrnambool closed Monday at A$9.29, suggesting shareholders believe the battle is not yet over.
Any deal will follow the sale by New Zealand’s Fonterra Cooperative Group of Western Australian dairy brand Brownes to Australian private equity firm Archer Capital in 2010.
Source: WSJ