National Foods makes offer for Dairy Farmers
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26/08/2008
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International Herald Tribune (Bangkok)
MELBOURNE: Kirin, the Japanese brewer, is expanding its food business in Australia through the acquisition of Dairy Farmers by its National Foods division.
The acquisition, for 910 million Australian dollars, or $780 million, is intended to help it diversify away from a shrinking domestic beer market.
Analysts said the move by Kirin, which bought National Foods for $1 billion in November, begins a long-awaited consolidation of Australia's dairy industry, which is largely based in various states and comprises farmer cooperatives as well as Fonterra, a New Zealand cooperative, and Parmalat of Italy.
Kristan Walker, an analyst for Deutsche Bank, said that the acquisition was "pretty pricey, but at the end of the day few would disagree it now gives National Foods more scale" in Australia.
Walker added, "The Australian assets, including Lion Nathan, have been one of the major earnings drivers for Kirin, so it looks as though Australia is becoming a more meaningful place of investment for them."
Lion Nathan, the large Australian brewer, is 46 percent owned by Kirin.
Kirin said last month that it would spend