Shareholders vote for sale

By Country News

Almost 70 years of history came to an end in a Melbourne building on Thursday when Murray Goulburn Co-operative shareholders overwhelmingly voted to sell the milk processor to Canadian company Saputo.

It was a sombre end for the processor, with many equating the $1.31billion sale to a funeral.

The final nail in the coffin came swiftly, with 97.9 per cent of shareholders voting in favour of the sale just six months after Saputo put forward its offer in October.

For many suppliers it was almost a foregone conclusion as many felt they had no option but to vote in favour, with Murray Goulburn’s own chief executive officer Ari Mervis previously labelling the processor ‘‘unviable’’ without the sale.

Plummeting milk supply was ultimately the straw that broke Murray Goulburn’s back. The company lost more than one billion litres of annual supply — or 45 per cent of its overall milk supply — in the 12 months following the 2016 milk price crisis as hundreds of dairy farmers fled from the processor.

Saputo chief executive officer Lino Saputo Jr said the vote was a ‘‘significant milestone’’ in the company’s bid to acquire Murray Goulburn.

Murray Goulburn supplier director Craig Dwyer thanked those across the generations who had helped build the company, and encouraged suppliers to ‘‘turn to the future’’.

‘‘MG has meant many things to many people; suppliers and employees alike,’’ Mr Dwyer told the meeting on Thursday.

‘‘I would encourage you all to give (Saputo) a chance to prove themselves with your supply, and build on the foundations created by so many of you and your hard-working dairy farming predecessors.’’

Originally established in Cobram in 1950 by seven dairy farmers, Murray Goulburn grew to 2000 suppliers and shareholders, with milk processing factories across the country including in Cobram and Rochester, which was closed in January.

Under the stewardship of chair Jim Gemmell the Cobram factory opened in 1951 and began exporting butter to the United Kingdom the following year.

Between 1950 and 1970 dozens of small factories opened up around the region including in Kyabram, Berrigan, Deniliquin and Rochester, with generations of dairy farmers supplying the co-operative.

The sale faced minimal resistance, however it will see Saputo forced to divest Murray Goulburn’s Koroit plant following concerns from Australia’s competition watchdog.

The Australian Competition and Consumer Commission had previously raised concerns about the acquisition of the Koroit plant which would have given the Canadian company control over two-thirds of milk supply in the region, leading to fears it would lessen competition and result in lower milk prices in the region.

The sale must still be approved by Foreign Investment Review Board but is expected to be completed by May 1.