Clearance Application From Fonterra

18 April 2002

Commerce Commission Receives Clearance Application From Fonterra

The Commerce Commission has received an application from Fonterra to acquire, through its wholly owned subsidiary Anchor Investments Limited (AIL), or any of its interconnected bodies corporate, the remaining 50% of shares in Grated Cheese Co Ltd (GCC) from Chad Holdings Limited (Chad).

AIL, which already owns the 50% shares in GCC, is an investment vehicle for Fonterra. It holds shares in a number of companies, including GCC, for investment purposes. Fonterra plans to on-sell its interest in GCC to Australian Food Holdings Limited, which is majority owned by Fonterra.

Chad's two shareholders, Bill Smith and Mal Walker, who are also the managing directors of GCC, wish to sell their shares.

In considering the application, the Commission's role is to determine whether the acquisition has the effect of substantially lessening competition in a market.

Background

GCC produces a range of grated, shredded and diced cheeses from cheese manufactured by Fonterra. It produces and markets a range of food service and consumer packaged grated cheese products under the Greenfields brand, and fills the New Zealand Dairy Board's export contracts for markets in Australia, Asia, Latin America and the Middle East.

Australian Food Holding Limited is Fonterra's principal investment vehicle into New Zealand and Australian consumer dairy markets.

A public version of Fonterra's application is available on request from the Commerce Commission. Please contact Catherine Best, (04) 924 3654.

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