Fonterra to lift shareholding in Soprole

Media Release

29 April 2008

Fonterra to lift shareholding in Chilean dairy company Soprole

Fonterra Co-operative Group today announced it has bought an additional 42.6 per cent shareholding in Chilean dairy company Soprole from Fundacion Isabel Aninat.

Fonterra has bought the shareholding, adding to its existing 56.85 per cent stake, from minority shareholder Fundacion Isabel Aninat, a charitable foundation run under Canonical Law. The US$201.9 million purchase has received final approval from the Vatican.

Fonterra’s Chief Executive Officer, Andrew Ferrier, said: “Soprole has been a strong performer for Fonterra over the years. By increasing our ownership, we will be able to build on this and look at ways we can grow the business even further.”

“We’re very pleased with the way Soprole is performing. More than 40 per cent of the company’s sales have been from products introduced in the last three years. We want to continue that innovation drive and create new opportunities in the rapidly expanding South American dairy markets.”   

Soprole in February announced its profit for the 2007 calendar year rose 160 per cent to a record 23.8 billion Chilean pesos, or NZ$66.3 million. Soprole has, on average, returned around NZ$25 million a year to Fonterra shareholders over the past few years.

The purchase gives Fonterra 99.4 per cent of Soprole, the second-most recognised corporate brand in Chile after Coca-Cola. Chile is a high growth market for the production and consumption of dairy products. Soprole is the country’s leading consumer dairy product business with a share of more than one-third of the domestic consumer dairy market.

“Soprole is an example of Fonterra’s strategies of leveraging its cow-to-consumer expertise to build profitable businesses, and also securing new sources of fresh milk around the world,” Ferrier said.

Fonterra is looking forward to a continued constructive relationship with the Fundacion as partners in Prolesur, Soprole’s southern manufacturing subsidiary. The transaction will leave Fonterra with 86.2 per cent of Prolesur, through its purchase of Soprole, and the Fundacion will retain its direct 13.6 per cent shareholding in Prolesur.

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