Fonterra to reduce stake in Chinese food manufacturer
Fonterra will sell a portion of its stake in Beingmate Baby & Child Food Company Ltd, which is currently 18.8%.
Chief Executive Miles Hurrell said this decision is part of Fonterra’s three-point plan to turn around the business, with the company re-evaluating every investment, major asset and partnership to ensure they still meet the company’s needs.
This involved a review of Fonterra’s relationship with Beingmate, and bringing the distribution of Anmum in China back in-house, under company management. Fonterra then ended the Darnum joint venture with Beingmate, brought back Beingmate’s share of the Darnum facility in Australia and entered into an agreement for Beingmate to purchase ingredients from Fonterra.
“What remains is our shareholding in Beingmate Baby & Child Food Co., which we now view as a financial investment only,” said Hurrell. As Fonterra has been unsuccessful in finding a buyer for its entire share of Beingmate, the company is now considering selling part of their holding.
“China will always be one of our most important markets. We’ve got a strong business there and are still very much focused on the areas in China where we can succeed,” Hurrell concluded.
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