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Wattle Health reaches revised deal with Mason on Blend & Pack purchase

Milk producer Wattle Health Australia Ltd. has reached an agreement to amend the structure of its acquisition of infant dairy products maker Blend and Pack Pty. Ltd. from Hong Kong-based Mason Group Holdings Ltd.

Wattle Health already has a 5% stake in Blend and Pack and is proposing to acquire 75% of the business, raising its ownership to 80%.

Under the amended deal, Wattle Health will pay Mason up-front cash of US$10 million, issue US$15 million worth of fully paid ordinary shares in Wattle Health at an issue price of 40 Australian cents apiece, and make a deferred payment of US$30 million over a five-year period with an interest rate of 3.33%.

In the previous agreement, Wattle Health agreed to an up-front payment of US$30 million and a deferred payment of US$25 million to Mason.

The Australian company said its board believes the new structure of the transaction terms will lead to a better outcome for shareholders as it is still for the same consideration of US$55 million but requires less cash payment up-front. Mason agreed to take equity for a portion of the up-front payment in the form of voluntary escrowed Wattle Health shares.

The deal is subject to shareholder approval, with the deadline set for Feb. 29.