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The German farm consultancy IFCN has estimated the world price for farmgate milk should have been 38.4 US cents/kg in February, based on world dairy commodity prices. This price is up 2.6c (+7.3%) from February and has increased by 7.5c (+24%) since December. It is 9.4% higher than a year earlier. The world price of cattle feed expressed as a milk price was down 0.3c from Feb to 21.7c/kg.
Saputo Inc. have confirmed they have today completed the acquisition of Dairy Crest Group in the UK, first announced on February 22. Saputo acquired the entire issued ordinary share capital of Dairy Crest for £6.20 per ordinary share, valuing DC’s share capital at £975m. The purchase price, payable in cash, was financed through funds drawn on a new bank term loan facility, implemented through a Court-sanctioned scheme of arrangement under the UK Companies Act 2006. They have acquired DC’s cheese, butters, spreads, oils and value-added dairy ingredients businesses. DC employ 1,100 people in seven locations in the UK, generating £456.8m in the year to March 2018 and post-tax profit of £149.5m (including exceptional items contributing £98.9m). They posted revenues of £224.9m and profit after tax of £14.5m in the 6mths to September 2018. Lazard acted as financial advisor to Saputo, and Freshfields Bruckhaus Deringer LLP and Stikeman Elliott LLP acted as legal counsel. National Bank Financial Markets and BMO Capital Markets acted as co-lead arrangers and joint bookrunners in respect of the credit facility.