Fonterra closes China deal
New Zealand-based dairy giant, Fonterra Co-operative Group, will purchase an 18.8 per cent stake of Chinese infant formula manufacturer, Beingmate Baby & Child Food Company, after confirming it has completed a partial tender for the shares.
Lukas Paravicini, CFO, Fonterra, said the companies had earlier made provision for the possibility of the partial tender offer reaching slightly less than 20 per cent.
“Our goal was to acquire 20 per cent. We are extremely satisfied and confident the partnership can and should proceed on the basis of the 18.8 per cent stake. It is a good result,” Paravicini said.
“Over the next few weeks, Fonterra and Beingmate will now move ahead with the next phase of our partnership, which includes establishing a joint venture to purchase the Darnum plan to Australia and finalising a distribution agreement making Beingmate Fonterra’s exclusive Anmum distributor in mainland China.”
Last August, Fonterra and Beingmate announced that they intended to form a global partnership to help meet China’s growing demand for infant formula.
The partnership will create a fully integrated global supply chain from the farm gate direct to China’s consumers, using Fonterra’s milk pools and manufacturing sites in New Zealand, Australia, and Europe.
It is intended to increase the volume and value of Fonterra’s ingredients and branded products exported to China.