Murray Goulburn calm on debt

MURRAY Goulburn has “sufficient funds” to pay debts for the next 12 months with or without the sale to dairy giant Saputo, according to its chief executive.

The dairy co-operative released its half-year financial statements yesterday, which highlighted its milk volume for the first half was 1.1 billion litres — 29.9 per cent down on the same time last year.

MG still anticipated milk intake for the season to be 1.91 billion litres, down just slightly on its original forecast of 1.93 billion litres, but significantly down on its 2015-16 intake of 3.5 billion litres.

In November last year, Saputo agreed to purchase MG’s assets and liabilities for $1.31 billion but the deal remains subject to shareholder and government regulatory approval.

The financials included a stark warning that “if the Saputo transaction does not pro- ceed and in the absence of an alternative transaction, the group may not be able to pay a competitive milk price”.

MG chief executive Ari Mervis remained confident the sale to Saputo would proceed.

But he said with or without the sale MG directors were confident MG would have sufficient funds to pay the debt MG faced in the “ordinary course of business”.

MG’s debt facilities are due to expire in the next two weeks.