San Miguel takes shot at Fonterra

San Miguel has attacked a planned joint venture between Fonterra and Yoplait claiming that it breaches the rules in the $2 billion takeover battle for National Foods.

The Filipino brewer has gone to Australia's Takeovers Panel alleging Fonterra has not adequately disclosed details of the joint venture.

San Miguel had its $1.92 billion bid for National Foods trumped by a revised Fonterra offer last week.

The panel told the Australian Stock Exchange yesterday it had received an application alleging that "unacceptable circumstances" existed because of inadequate disclosure about a possible joint venture between National Foods, Sodima and Yoplait if Fonterra acquired all of the shares in the takeover target.

National Foods distributes the Yoplait brand in Australia and Sodima is a Yoplait-controlled company which is a counterparty to manufacturing and distribution agreements with National Foods.

San Miguel alleges that the possible joint venture has made Yoplait and Sodima associates of Fonterra.

It argues that Yoplait and Sodima should have lodged substantial holding notices and added details of each agreement or arrangement between the parties.

Complaints about breaches of rules are not an uncommon tactic in contested takeovers.

The Rural Portfolio Investments takeover of Wrightson last year saw both parties making formal accusations over technical breaches.

In 2003, the takeover of Goodman Fielder by Burns Philp also also went to the panel.

A San Miguel spokesperson said the company would not make any more comment because the application had to follow due process.

A Fonterra spokesman said the company maintained it had made adequate disclosure.

When the dairy giant raised its bid last week it disclosed negotiations to secure distribution rights of Yoplait yoghurt had resulted in the proposal for a joint venture to operate on both sides of the Tasman.

Because it would only happen if 100 per cent control was achieved, it was too early to talk about the details.

The panel has not decided whether to proceed with the application and made no comment on the merits of the application.

It said it had not received submissions from the other parties involved but a sitting panel would be formed to consider the application.

National Foods' board has thrown its support behind Fonterra's revised bid.

Tomorrow is the deadline for San Miguel to make any changes to its existing bid.

It can either lift the offer or extend its March 18 closing date. If it leaves the bid unchanged, it will effectively hand the deal to Fonterra.

The complaint

* San Miguel says Fonterra has not disclosed enough details about a possible joint venture with Yoplait.
* It has made a complaint to the Australian Takeovers Panel.
* The panel has not yet decided whether to investigate.