Fonterra Sells Mainland Group to Lactalis for $4.2 Billion

Fonterra is set to finalize the sale of its Mainland Group to the French dairy giant Lactalis for $4.2 billion, with the transaction expected to conclude by the end of March. This deal will affect approximately 4,200 employees across various regions, including Oceania, Sri Lanka, and the Middle East. In Australia and New Zealand alone, 2,500 employees will transition to the Mainland Group.

Mainland Dairy, under its new ownership, will continue to collect milk fr om 460 farmers and operate eight manufacturing sites in Victoria and Tasmania. The transition will see well-known Australian brands like Perfect Italiano, Mainland, Western Star, and Bega under the new ownership of Mainland Dairy.

According to David Breckenridge, managing director of Fonterra Oceania, the leadership team, field staff, and service offerings will remain unchanged, except for the brand logos, which will be updated to reflect the new ownership. Breckenridge emphasized the ease of this transition, noting that the corporate ownership change will not affect the operational structure of the business.

Fonterra will maintain a limited presence in Australia, retaining access to a small number of customers, while Mainland Dairy will act as a distributor for Fonterra products in the region. At the Australian Dairy Conference, wh ere Mainland Dairy is a major partner this year, Fonterra's reduced presence is noticeable, marking a significant shift in the company's focus in Australia.

The sale marks a strategic move for Fonterra as it refocuses its business operations, while Lactalis continues to expand its global footprint in the dairy industry.