Fonterra Shareholders to Approve $3.2 Billion Capital Return from Mainland Sale

Fonterra Co-operative Group is expected to receive shareholder approval for a $3.2 billion capital return. This move comes after the sale of Mainland Group to Lactalis, a decision that was initially approved in October with 88% shareholder support.

The upcoming vote represents the second shareholder meeting regarding this transaction, underscoring its significance to the co-op. The capital return had been anticipated since Fonterra first announced its intention to divest nearly two years ago.

Fonterra's decision to return capital to shareholders is part of its broader strategy to optimize operations and financial performance. The deal with Lactalis, valued at $4.2 billion, marks a significant transaction in the dairy sector, reflecting ongoing consolidation trends in the industry.

John Stevenson, the chair of the Fonterra Co-operative Council, is tasked with guiding the shareholders through the approval process. The council plays a critical role in ensuring shareholder interests are represented in decisions of this magnitude.

The approval of this capital return is seen as a routine step following the divestment, with expectations of smooth proceedings during the vote. Shareholders previously indicated strong support for the sale, which was seen as a strategic move for Fonterra.