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Murray Goulburn Co-operative Co Limited (MG) owns MG Responsible Entity Limited (MGRE), which is the trustee of the ASX listed MG Unit Trust (ASX:MGC). At the 2018 Annual General Meeting (AGM) of MG, MG informed that it has been undertaking further work to better understanding the ongoing operational costs of MG, particularly in the insurance premiums in the current tightened insurance market.
After gaining a better understanding of the ongoing operational costs and discussions with its insurance advisors, MG believes that if it delists MG Unit Trust (MGC) from Australian Stock Exchange, it could substantially decrease its future insurance premiums. On this basis, the MGREâs Board is planning to seek approval from Unitholders for the delisting of the MG Unit Trust, and it will convene a meeting of Unitholders to occur sometime in February or March 2019 to seek that approval.
As per MGâs inquiries with its insurance advisors, it is expected the ongoing annual insurance premiums, and the final insurance premium for run-off insurance could be substantially reduced if the MG Unit Trust is delisted from ASX. In accordance with the usual delisting requirements of ASX, if Unitholder approval is obtained for delisting the MG Unit Trust, it is expected that units will continue to trade on ASX for one month after the Unitholder approval is obtained.
In FY 2018, MG Unit Trust Unit Trust reported nil profit after income tax. The value of Unit Trust assets at 30 June 2018 of $52,057,745 (2017, $132,315,558) was valued at fair value through profit or loss. At the end of 2018, MG had restricted cash at bank of $5 Mn and Cash at bank and term deposits with banks of $265.319 Mn. As at 31 December 2018, the interest accrued was $803K.
During FY 2018, the sale of Murray Goulburn's operating assets and liabilities to Saputo Dairy Australia Pty Ltd was completed, proceeds of which used to repay Murray Goulburn's debt obligations, return capital to shareholders and unitholders. The proceeds will also be used to fund any potential obligation arising from the Retained Litigation against Murray Goulburn.
During the past one year, MGC has yielded a positive return of 118.62 percent by increasing from $0.126 on 22 January 2018 to $0.275 on 22 January 2019. Moreover, in the past month, the scrip has increased by 5.77 percent. MGC shares traded at $0.275 with the day's traded volume of 85,649 (AEST: 01:38 PM). The company has ~216.91 million shares outstanding with the market cap of circa ~$58.56 million. Further, the company has a 52-week high price of $0.345 and a 52-week low price of $0.123, with an average trading volume of around 165,934.
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