Forrest buys into Bega after profit update

by | Jan 12, 2022 | Australia, News

Tattarang AgriFood Investments has become a substantial shareholder in Bega Cheese, paying more than $100m for a 6.61% stake in the processor. Tattarang holds a 36% shareholding in Fortescue Metals Group, chaired by Andrew “Twiggy” Forrest. Over six weeks through November and December, Tattarang purchased more than 20m shares, sending Bega shares up to a high of $5.67 in trading on the ASX on the last day of 2021, but the share price since eased, trading at $5.35 per share at close of business Tuesday 11 January 2022.

Bega Cheese shares plummeted as the processor released a trading update for FY2022 to the ASX on 23 December 2021, downgrading its normalised EBITDA forecast to a range of $195m to $215m – short of analysts’ expectations – after booking $142m in FY2021. Bega warned that while it was focused on managing the cumulative effect of direct and indirect costs associated with COVID-19, the timing of both price increases and the removal of COVID-19 related costs will affect business performance in FY2022. However, Bega remains satisfied with its strategic position as the diversity of its business, which includes its portfolio of brands, Australian and international customer channels and an extensive product mix, will allow the company to deal with changes and challenges ahead.