Murray Goulburn chairman, Philip Tracy, yesterday invited the cooperatives 2,500 supplier shareholders to an EGM in Melbourne on May 8 2015 to vote on a proposed new capital structure.
Victoria-based Murray Goulburn, Australia's largest dairy cooperative, believes it could raise AU$500m (US$390m, €360m) through the capital structure proposed, which it would use to "support its growth and value creation strategy."
The majority of this AU$500m target would be raised through an IPO of a unit trust Murray Goulburn would list on the Australian Securities Exchange (ASX). The remainder would be raised through an offer of shares to Murray Goulburn suppliers, it said.
Those that invested through the IPO would have an economic exposure to Murray Goulburn's business, but no voting rights.
"Underpin higher returns"
If approved by the dairy cooperative's shareholders next month, the new capital structure will facilitate Murray Goulburn's pursuit of growth while ensuring its 2,500 supplier shareholders remain 100% in control.
"We will use the capital raised to invest in world leading manufacturing and supply chain capabilities to improve efficiencies and increase market reach in key growth categories including consumer cheese, dairy beverages and nutritional powders," said Gary Helou, managing director, Murray Goulburn.
"These initiatives will underpin higher returns to suppliers over the longer term as we capitalise on growing demand for value-added dairy food products in Australia and Asia."
"A further feature of the recommended structure is that MG shares will have a market value for the first time," said Helou. "This is good news for our suppliers as lenders will recognise the value of their MG shares, thereby strengthening supplier balance sheets."