Tasmania’s famous King Island Dairy facility in Tasmania may soon be on the market.
Owner Saputo Dairy Australia (SDA) says it is conducting a strategic review of King Island Dairy’s future – at the same time it has also committed an additional $27 million towards improvement projects across its sites in Victoria and Tasmania, which will commence this fiscal year.
SDA said it intends to continue regular operations at the King Island Dairy facility while the review proceeds, which aims to assess possible future scenarios to maximise business value.
The company will work closely with its advisors, MA Moelis Australia, to consider various strategic, commercial and financial alternatives, including a potential sale to a third party.
Leanne Cutts, president and COO of Saputo Inc, said the strategic review aligns with the company’s previously confirmed consolidation initiatives to increase efficiency and reduce operating costs.
“We remain focused on maximising our return for every litre of milk to enhance further SDA’s position as a high-quality, low-cost processor in Australia.”
Some 60 employees at the facility have been informed of the strategic review, and site management will work closely with them throughout the process.
Alongside this strategic review, SDA will continue a series of investments across its Victorian and Tasmanian sites. The company will fund an additional $27 million in new capital projects, including $8 million to improve its climate, water and waste performance.
Cutts added that Saputo hopes to find a buyer for the facility and continue the production of its specialty cheese.
“We recognise the potential impact any decision may have on the King Island community, especially our employees and dairy farmers, and we are committed to thoughtfully considering all possible scenarios before making any decisions,” she concluded.
