MONTREAL—Saputo Inc. is diving deeper in the Australian dairy industry.
The Canadian milk and cheese producer has agreed to buy Melbourne-based Murray Goulburn Co-Operative Co. in a deal valued at $1.29 billion.
The agreement will significantly boost Saputo’s business in Australia, where it already ranks among the top four dairy processors.
“By acquiring a well-established industry player, the company reinforces its commitment to strengthen its presence in the Australian market,” the Canadian firm said in a statement. “Saputo intends to continue to invest in its Australian platform and contribute to the ongoing development of its domestic and international business.”
Murray Goulburn makes milk, cheese and butter, as well several other dairy products and employs approximately 2,300 workers. It operates 10 manufacturing plants across southeast Australia and Tasmania, as well as one in China. It recorded revenues of about $2.5 billion over the 12 months ending June 30.
Though the deal has secured the unanimous approval of Murray Goulburn’s board, it remains subject to shareholder and Australian Competition and Consumer Commission approval.
Saputo expects the deal to close in the first half of 2018.