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Murray Goulburn to potentially list on the ASX

Victorian dairy cooperative, Murray Goulburn has outlined plans that will potentially see the processor generate $500m in capital over the coming three to five years.

ABC News reports that a discussion paper was recently sent out to suppliers and shareholders discussing the proposed changes, which includes potentially listing the cooperative on the Australian Securities Exchange (ASX).

According to the paper, Murray Goulburn is hoping to rejuvenate its manufacturing and supply chain infrastructure by raising capital through the issuing of shares in a unit trust.

The paper outlines that a unit trust would be a far more preferable way of raising funds compared to undertaking a $500m investment purely from bank debt funding, as an increase in bank debt would mean the cooperative would be ‘very close to reaching its prudent and permitted peak borrowing levels.’

However, unit trust holders would not gain any voting rights over MG’s operations, meaning that the cooperative’s active suppliers who hold voting shares will retain their voting rights.

It is hoped that the structural changes would also encourage new suppliers to join the cooperative, resulting in the increase of Murray Goulburn’s milk supply and ultimately delivering a higher farm gate milk price.

Should the structural changes be approved, implementation would most likely take place in early 2015.

 

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