Milk processing Exchange of blows over milk processor Hochdorf enters a new round

Italian shareholder Newlat is not letting up on milk processor Hochdorf. It has submitted an unannounced, non-binding proposal to purchase the operational business, which is bundled in Hochdorf Swiss Nutrition (HSN). The Board of Directors of Hochdorf waves it off.

Hochdorf intends to put the sale of the milk processor to the Swiss-British private equity firm AS Equity Partners to a vote of its shareholders at an Extraordinary General Meeting on September 18 as planned, as Hochdorf announced on Wednesday.

Newlat has not yet submitted a binding offer for HSN, Hochdorf added. Instead, the Italians have only made "various rudimentary, unstructured purchase approaches" in recent months.

The deal planned with AS Equity Partners, on the other hand, offers a high level of transaction security, it added. The Board of Directors therefore remains convinced that the private equity firm will be the best owners for the Hochdorf-based company.

Newlat contradicts

Newlat did not accept these statements from Hochdorf. It had "repeatedly expressed its interest in acquiring HSN" and submitted a binding offer to purchase all shares on September 9, the Italian group announced.

In the press release, Newlat emphasizes that its own offer provides for a cash payment of 93 million Swiss francs. The offer of 83 million francs from AS Equity Partners, which is preferred by the Board of Directors, will not be paid in cash. The company's own offer is a more advantageous alternative for shareholders, both in terms of value and security, explained Newlat.

The Hochdorf Board of Directors, on the other hand, explained that it was not clear what amount would actually be paid in the end in the case of Newlat's offer. "The purchase price is not fixed in Newlat's proposal, unlike in the contract with AS Equity Partners".

Debts not covered

It is clear that the proceeds will not be sufficient to fully cover Hochdorf Holding's debts, as was the case with the solution with AS Equity Partners, explained Hochdorf. "The shareholders will lose their investments in both scenarios."

Last May, Newlat failed in its attempt to take over the entire Board of Directors of Hochdorf. Newlat wanted to implement a "radical restructuring" at Hochdorf with a new Board of Directors.

Newlat still holds a substantial stake in the struggling milk processor. According to the last notification of shareholding published on the Swiss stock exchange in May, the stake amounts to around 9.7 percent.

SDA