19th Oct 2015 14:31
LONDON (Alliance News) - Dairy Crest Group PLC on Monday said the sale of its Dairies operation to Muller UK & Ireland Group LLP will complete on December 26, after it received approval from the UK Competition and Markets Authority.
Dairy Crest said the consideration payable by Muller remains at GBP80 million, and that Muller has withdrawn its right not to complete the purchase should there be a deterioration of more than GBP20 million from the agreed level of profitability of Dairy Crest's Dairies operations.
The dairy producer added that it will make a one-off payment of GBP15 million to Muller on completion to help meet the additional cost of the modified undertakings demanded by the competition regulator.
"We are delighted that the sale is now confirmed and will complete this year. This is a transformational moment for Dairy Crest and the wider dairy industry. The deal will help to create a more sustainable UK dairy sector. It will deliver economies of scale and cost efficiencies that will underpin investment in the sector and help the UK to compete more successfully in global markets," Chief Executive Mark Allen said in a statement.
"Dairy Crest will now be able to focus on growth, through both our branded cheese and spreads operations and new revenue streams from manufacturing products for the fast-growing global infant formula market. We will work with Müller to ensure completion is achieved as smoothly as possible," he added.
Shares in Dairy Crest were trading up 0.1% at 603.50 pence Monday afternoon.
By Karolina Kaminska; [email protected] @KarolinaAllNews
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