The Dutch dairy co-operative has already upped its stake from 8.1% to 68.9% via the purchase of 535.7m shares held by AMC founders the Uytengsu Family, for PHP (Philippine peso) per share.
A further debt-financed purchase will see Friesland Campina submit a tender offer for the remaining outstanding publicly traded shares at an identical price, and Friesland Campina said the transaction would strengthen its position in Asia, a “strategic growth area”.
According to Friesland Campina, AMC (turnover circa. €200m, 1,000+ staff) had shown “consistent brand leadership” in the canned liquid milk category (pictured), a strong, growing position in powdered milk, and recently expanded into value-added milk products such as ready-to-drink milks.
Nestlé is the leading market player in Filipino dairy, but Friesland Campina said that AMC's brands ranked both first and second within the country.
Strong growth in The Philippines
AMC reported autonomous growth of 9% from 1999-2010, and average double-digit earnings before interest and tax (EBIT) since 2001; Friesland Campina said the takeover would raise turnover within its Consumer Products International Division from around €2.5bn to €2.7bn (total sales almost €9bn).
Cees`t Hart, CEO, Friesland Campina, said: “Adding AMC gives us a strong, high-growth platform in The Philippines and access to a market of around 100m consumers. It also confirms our international ambition to enter markets where Friesland Campina can create value.
AMC’s management had already built up a strong position within the Filipino market, Hart said: “Together we can expand this position by introducing tried and tested Friesland Campina concepts that have been successful in other parts of the world.”
Jan-Willem ter Avest, corporate media relations manager, Friesland Campina, told DairyReporter.com: “We will bring out the sale offer, and there is a date set for that, and that is the next stage, and we think the transaction will close [subject to regulatory approval] in the mid-May.”
Valorise member milk
Asked whether Friesland Campina saw opportunities to further its brands within the country, or increase fresh dairy consumption, he said:“The first thing we are going to do is to integrate it into our company, and we will take some time for that.
“There is no discussion on integrating brands, etc., but of course we will use powdered milk from The Netherlands for production in The Philippines.”
Had the takeover been in the offing for a long time, or was it an opportunistic move on the part of Friesland Campina? “We’ve known each for a long time now, and I think that is the important thing. We know the business, it’s family owned, and that makes it much easier,” ter Avest said.
Friesland Campina had been involved in Alaska Milk since its foundation [in 1972], he added: “In the past there were connections with Campina, and later – when they went onto the stock exchange – we took a stake in the company.”
Following the takeover, AMC president and CEO, Wilfred Steven Uytengsu, will retain his position: “We expect this historical agreement to propel AMC to its next stage of growth and that the products developed by Friesland Campina will strengthen our position in all dairy categories,” he said.