Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Fonterra And Nestlé Realign Latin American Venture

Fonterra And Nestlé Realign Decade Long Latin American Joint Venture


Fonterra and Nestlé have realigned their 10-year old Dairy Partners Americas (DPA) 50/50 joint venture and signed binding agreements covering the revised scope of the alliance.

Under the agreements:

• Fonterra will take a 51 per cent controlling stake in DPA Brazil, with Nestlé holding the balance;
• Fonterra together with a local partner will acquire Nestlé’s share of DPA Venezuela;
• Fonterra will sell its share in DPA’s milk powder manufacturing business to Nestlé;
• Nestlé will buy Fonterra’s share in DPA Ecuador.

Fonterra’s CEO, Theo Spierings, says the DPA joint venture has performed well for ten years and now the time is right to realign the partnership to better reflect the respective strategies of Nestlé and Fonterra in the region.

He says the revised alliance supports Fonterra’s group strategic focus on everyday nutrition in key growth markets such as Latin America, China and Indonesia.

“We value our relationship with Nestlé and this high-quality agreement will see our successful alliance continue.
“The deal also enables the Co-operative to drive more long-term value in the region for its farmer shareholders,” he says.

Fonterra’s Managing Director of Latin America, Alex Turnbull, says: “The region’s economies have undergone considerable change during the past 10 years. We’ve seen increased prosperity in markets like Brazil with rapidurban growth and a focus on healthy nutrition driving demand for dairy products.

“A bigger stake in DPA Brazil means we will be well placed to drive our volume and value growth strategy focusing on everyday nutrition offerings.”

Fonterra’s Latin American footprint drives more than 900,000 metric tonnes of volume per year and $3.5 billion (NZD) in revenue from consumer dairy, foodservice and dairy ingredients.

“We are very proud with what we’ve achieved through the DPA joint venture with Nestlé and are looking forward to continuing to work together with renewed focus,” says Mr Turnbull.

The changes to the joint venture are subject to regulatory approval. As a consequence of the realignment,Fonterra expects to receive about $96 million (NZD) in the next financial year.

About Dairy Partners Americas

Set up in 2003, Dairy Partners Americas is the largest dairy company in South America, purchasing and processing more than two billion litres of milk each year in Brazil alone. DPA produces ingredients and consumer products with strong brands in the liquid and chilled dairy market throughout Latin America.

Fonterra licenses brands and provides its large-scale milk procurement, product development, and manufacturing and processing expertise, as well as technical services and certain technology to the alliance.

Nestlé licenses brands and provides its product development, manufacturing and processing expertise, as well as distribution infrastructure to the alliance.

- ENDS -

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Must Sell 20 Petrol Stations: Z Cleared To Buy Caltex Assets

Z Energy is allowed to buy the Caltex and Challenge! petrol station chains but must sell 19 of its retail sites and one truck-stop, the Commerce Commission has ruled in a split decision that acknowledges possible retail price coordination between fuel retailers occurs in some regions. More>>

ALSO:

Huntly: Genesis Extends Life Of Coal-Fuelled Power Station To 2022

Genesis Energy will keep its two coal and gas-fired units at Huntly Power Station operating until 2022, having previously said they'd be closed by 2018, after wringing a high price from other electricity generators who wanted to keep them as back-up. More>>

ALSO:

Dammed If You Do: Ruataniwha Irrigation Scheme Hits Farmer Uptake Targets

Enough Hawke's Bay farmers have signed up for water from the proposed Ruataniwha Water Storage Scheme for it to go ahead as long as a cornerstone institutional capital investor can be found to back it, its regional council promoter announced. More>>

ALSO:

Reserve Bank: OCR Stays At 2.25%

Reserve Bank governor Graeme Wheeler kept the official cash rate at 2.25 percent, in a decision traders had said could go either way, while predicting inflation will pick up as the slump in oil prices washes out of the data and capacity pressures start to build in the economy. More>>

ALSO:

Export Values Down: NZ Posts Biggest Annual Trade Deficit In 7 Years

New Zealand has recorded its biggest annual trade deficit since April 2009, reflecting weaker prices of agricultural commodities such as dairy products, beef and lamb, and increased imports of vehicles and machinery. More>>

ALSO:

Currency Events: NZ's New $5 Note Wins International Banknote Award

New Zealand’s new Brighter Money $5 note has been named Banknote of the Year in a prestigious international competition. The $5 note was awarded the IBNS Banknote of the Year title at the International Bank Note Society’s annual meeting. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news