FrieslandCampina Pursues Acquisition of Fonterra's Australian Division
Source: The DairyNews
The Australian branch of New Zealand dairy giant Fonterra is up for sale, attracting significant interest from FrieslandCampina, according to Australian media reports.
FrieslandCampina, in partnership with Pacific Equity Partners (PEP), has made an unsolicited bid to acquire either part or the entirety of Fonterra’s Australian operations. These bids were reportedly submitted by the end of 2023, as per sources within the dairy industry cited by The Australian newspaper. Additionally, The Weekly Times has reported that FrieslandCampina and France’s Lactalis remain key contenders in the acquisition race. Both companies must comply with Australia’s stringent foreign investment regulations to proceed.
FrieslandCampina has declined to confirm or deny its interest in the acquisition. “As FrieslandCampina, we never respond to speculation and rumors,” stated spokeswoman Eline Leenaarts.
Fonterra, listed on the Australian Securities Exchange (ASX), engaged investment banks Jarden, Craigs, and JPMorgan on July 24 to facilitate the sale of its dairy brands and ingredients business, valued at approximately €1.8 billion. The sale process is anticipated to commence by the end of this year.
Potential bidders for Fonterra’s Australian division also include Canada’s Saputo and Australia’s Bega, although these companies may face regulatory hurdles due to competition laws. The Australian Competition and Consumer Commission is expected to scrutinize and possibly block any acquisition by Saputo or Bega to maintain competitive market conditions.
Other investment firms, such as BGH Capital, Bain Capital, Affinity Equity Partners, CVC, Fountain Vest, and PAG, are also considered potential candidates for the acquisition. An exploratory study is set to begin soon, which will provide recommendations for the sale.
Fonterra Australia is part of Fonterra Oceania, which includes Fonterra Brands in New Zealand, encompassing well-known brands such as Anchor, Anmum, De Winkel, Farm Source, Mainland, Perfect Italiano, and Primo, as well as the ingredient company New Zealand Milk Products (NZMP).
Fonterra Australia operates eight dairies across Victoria and Tasmania, employing approximately 1,600 people and collecting around 1.4 billion liters of milk annually from hundreds of Australian dairy farmers. The potential sale has raised concerns among dairy farmers, who fear that Fonterra’s exit could reduce competition among processors, potentially impacting milk prices.
Fonterra’s Australian operations are less profitable compared to its New Zealand business, primarily due to lower milk prices in New Zealand. The annual gross profit in Australia is approximately €180 million, though this figure varies year by year. In May 2023, Fonterra announced its intention to divest its Australian division, further fueling industry speculation and interest from potential buyers.
FrieslandCampina has declined to confirm or deny its interest in the acquisition. “As FrieslandCampina, we never respond to speculation and rumors,” stated spokeswoman Eline Leenaarts.
Fonterra, listed on the Australian Securities Exchange (ASX), engaged investment banks Jarden, Craigs, and JPMorgan on July 24 to facilitate the sale of its dairy brands and ingredients business, valued at approximately €1.8 billion. The sale process is anticipated to commence by the end of this year.
Potential bidders for Fonterra’s Australian division also include Canada’s Saputo and Australia’s Bega, although these companies may face regulatory hurdles due to competition laws. The Australian Competition and Consumer Commission is expected to scrutinize and possibly block any acquisition by Saputo or Bega to maintain competitive market conditions.
Other investment firms, such as BGH Capital, Bain Capital, Affinity Equity Partners, CVC, Fountain Vest, and PAG, are also considered potential candidates for the acquisition. An exploratory study is set to begin soon, which will provide recommendations for the sale.
Fonterra Australia is part of Fonterra Oceania, which includes Fonterra Brands in New Zealand, encompassing well-known brands such as Anchor, Anmum, De Winkel, Farm Source, Mainland, Perfect Italiano, and Primo, as well as the ingredient company New Zealand Milk Products (NZMP).
Fonterra Australia operates eight dairies across Victoria and Tasmania, employing approximately 1,600 people and collecting around 1.4 billion liters of milk annually from hundreds of Australian dairy farmers. The potential sale has raised concerns among dairy farmers, who fear that Fonterra’s exit could reduce competition among processors, potentially impacting milk prices.
Fonterra’s Australian operations are less profitable compared to its New Zealand business, primarily due to lower milk prices in New Zealand. The annual gross profit in Australia is approximately €180 million, though this figure varies year by year. In May 2023, Fonterra announced its intention to divest its Australian division, further fueling industry speculation and interest from potential buyers.
23.09.2024
Carbon emissions in global milk production - the elephant in the room
I have been thinking to make this post yes/ no. I decided for yes and like to ask everyone to not "shoot the messenger". The chart shows an analysis of IFCN Dairy Research Network from the 2024 supporter conference in Poland.
