Fonterra and Nestlé agree to sale of Brazilian joint venture
Fonterra and Nestlé have agreed to the sale of their Dairy Partners Americas (DPA) Brazil joint venture to French dairy company Lactalis for BRL700m (AU$194m). The deal is expected to be completed by mid-2023, subject to regulatory authority approvals.
Fonterra Chief Executive Miles Hurrell said the sale is aligned with the co-op’s strategy of prioritising its New Zealand milk pool, and Fonterra was pleased to have secured it. DPA Brazil had been held for sale in Fonterra’s financial statements since January 2020; however, market conditions related to COVID-19 had delayed the sale.
“DPA Brazil has reached maturity as an investment for us, and the sale allows us to prioritise our resources to the businesses that are core to our strategy,” Hurrell said.
DPA was created by Fonterra and Nestlé in 2003 to manufacture and commercialise dairy products throughout Latin America. The joint venture refocused its activities on Brazil and chilled dairy in 2014.
Fonterra holds a 51% stake in the venture, and Nestlé 49%.
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