Japanese brewer Kirin Holdings has reportedly entered into a deal to sell its Lion Dairy & Drinks subsidiary in Australia to local company Bega Cheese.
The news was broke by Japanese news site Nikkei Asia which valued the deal at 40 billion yen (AU$527 million), reporting an official announcement is imminent.
The sale would appear to be at a discount to the $600 million that China’s Mengniu Dairy Company agreed to pay last year in a deal which received ACCC clearance in February but was scuttled in August after failing to receive approval from the Foreign Investment Review Board.
Nikkei said the sale marked the end of a drive by Kirin to restructure or sell off less-profitable business arms as it moves to focus on health-related products while expanding its craft beer business overseas.
The newspaper also reported that Canada’s Saputo had been in the running for the dairy business after the Mengniu deal was scrapped, but pulled out last month. Saputo owns the soon-to-be-phased-out cheese brand Coon and last year acquired Lion’s Tasmanian cheese business, including the King Island Dairy brand.
The remaining business of Lion includes milk, milk-based beverages, yoghurt, juice and water brands, as well as its international business, its share of joint ventures Vitasoy Australia Products and Capitol Chilled Foods Australia, and a licensing agreement for Yoplait, along with Lion’s raw-milk processing facilities, two of which are located in Chelsea and Morwell in Victoria.