Bega Cheese brings Vegemite home after 90 years in $460m acquisition


19 January 2017 | Bega Cheese expands into new categories.


Bega Cheese has brought Vegemite ownership back to Australia with the acquisition of Mondelez International's Australia and New Zealand grocery and cheese business.

The Aussie-known spread has been owned by overseas companies since 1926, following a joint venture between founder Fred Walker & Company and the US JL Kraft.

The acquisition, valued at $460 million, includes brands Zoosh and Bonox, giving Bega Cheese entry into the salad and soup markets.

Kraft-licenced spreads – such as peanut butter, nut spreads and mayonnaise – are also included in the deal, but Vegemite is the largest of the lot with a 14% share of the spreads market – a segment valued at $550 million.

The acquisition is "strategically important and company making", said Barry Irvin, executive chairman of Bega Cheese, who added it was representative of two Australian institutions coming together.

"The wonderful heritage and values that Vegemite represents and its importance to Australian culture makes its combination with Bega Cheese truly exciting," he said in a statement.

"These iconic brands alongside the Bega brand are strong building blocks to enable Bega Cheese to become a great consumer goods business."

Bega will fund the buyout by bank debt, but claims it intends on paying it down in the near term by exploring "corporate opportunities".

The businesses have a combined revenue of $310 million a year and are expected to generate a gross profit – as measured by earnings before interest, tax, depreciation and amortisation – of $40 to $45-million in the first full year.


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