Tuesday 1st September 2015 |
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A2 Milk Co, the milk marketing company, says "no takeover offer is imminent" after US based Dean Foods and Australian based Freedom Foods stopped talking about their offer.
Dean Foods and Freedom Foods, which is a major supplier to and shareholder in A2, put forward an expression of interest to buy the company in June for an undisclosed amount, and were subsequently knocked back by A2's board a month later, which said the deal wasn’t compelling enough and talks have since stalled. Last month, A2 said it hadn't received any more word on the bid.
ASX listed Freedom Foods yesterday said it has "ceased detailed discussion in relation to A2" with Dean Foods, and is still reviewing its 18 percent holding in the firm, "including evaluating the benefits of maintaining a strategic stake".
A2 today asked for its NZX traded shares to be halted pending an announcement shortly after the market opened, after its shares dropped 7.1 percent to 65 cents. The company reiterated its August statement, that it had received no further communications from Dean Foods and Freedom Foods, and the shares are now down 2.9 percent to 68 cents since the halt was lifted.
"Although there has been no formal withdrawal of the expression of interest, the board continues to consider that no takeover offer is imminent," A2 said.
Last month, Australian sources told BusinessDesk the transaction was off the table, with Dean Foods distracted by an insider trading investigation launched by US federal authorities. The Wall St Journal has reported both criminal and civil authorities are investigating whether the former chairman of Dean Foods, Tom Davis, leaked inside information about a corporate spin-off to professional gambler, William T Walters, who in turn, is suspected of tipping off championship golfer Phil Mickelson.
Dean Foods has been subpoenaed to provide documents after reports the investigation centres on the company’s spin-off of a WhiteWave Foods subsidiary in August 2012.
BusinessDesk.co.nz
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