Cathedral City owner Dairy Crest to be gobbled up by Canada’s Saputo
Canada’s Saputo has announced a £975 million takeover of Cathedral City and Clover owner Dairy Crest.
Under the terms of the deal, Dairy Crest investors will receive 620p per share in cash, an 11.7% premium on Thursday’s closing price.
The Dairy Crest board is unanimously recommending the all-cash offer.
If the deal is backed by investors, the combined group’s headquarters will be located at Saputo’s head office in Montreal, Quebec.
The management of UK operations will continue to be based in Surrey, England.
Saputo chairman and chief executive Lino Saputo Jr said: “Dairy Crest is an attractive platform for Saputo and fits well within our growth strategy.
“We believe that under Saputo ownership, Dairy Crest will be able to accelerate its long-term growth and business development potential and provide benefits to Dairy Crest’s employees and stakeholders.
“This recommended offer represents a compelling opportunity for Dairy Crest shareholders, providing immediate value certainty.”
Saputo – one of the biggest dairy processors in the world – has grown recently through a series of acquisitions and the firm said its takeover of Dairy Crest is motivated by a desire to increase its international presence and enter the UK market.
It would mark the Canadian company’s first foray into Europe and it wants to accelerate Dairy Crest’s growth plans.
Saputo added that it does not envisage any material change to the research and development functions of Dairy Crest, nor does it intend to dispose of any material part of the group’s operations.
Stephen Alexander, chairman of Dairy Crest, said: “The board is unanimously recommending this all-cash offer by Saputo to buy Dairy Crest at an attractive premium, which represents compelling value for Dairy Crest shareholders.
“Dairy Crest is a leading UK dairy company and the proud manufacturer of Cathedral City, the largest UK cheese brand. Saputo is one of the top 10 dairy processors in the world. Both companies have built strong positions in the cheese sectors in their respective home markets.
“The acquisition should enable Dairy Crest to benefit from Saputo’s global expertise and strong financial position to fulfil and accelerate its growth ambitions.”