New Zealand's Fonterra Gets Farmers' Approval For $2.42 Billion Consumer Business Sale
Samantha LuanNew Zealand dairy producer Fonterra Co-operative Groupsaid on Thursday its farmer shareholders have agreed to the NZ$4.22 billion ($2.42 billion) divestment of its global consumer and associated businesses to French dairy major Lactalis.
New Zealand dairy producer Fonterra Co-operative Groupsaid on Thursday its farmer shareholders have agreed to the NZ$4.22 billion ($2.42 billion) divestment of its global consumer and associated businesses to French dairy major Lactalis.About 88.5% of the total farmer votes were cast in support of the sale after the deal had been backed by the board, the dairy company said.
The sale includes Fonterra's global consumer business — encompassing the operations of brands such as Mainland and Anchor butter, Kapiti ice cream and cheese, and the Anlene powdered milk supplement — as well as long-term commitments to purchase milk from Fonterra.Privately held Lactalis, the world's largest dairy company, counts names such as France's brie cheese maker President and Italy's mozzarella producer Vallelata among its brands, and sells everything from yoghurt to flavoured milk and desserts.Fonterra's more than 8,000 shareholder farmers will get a significant capital return, with ASB Bank economists inferring an average capital return of around NZ$393,000 per farm.
That could provide a notable boost to rural New Zealand at a time when the economy is struggling, having contracted in three of the last five quarters.However, the deal has not been overwhelmingly supported more broadly in New Zealand, with Foreign Minister Winston Peters campaigning against the sale.Peters said in a post on X that the sale was "utter madness" and "economic self-sabotage".The transaction also covers the dairy company's Foodservice and Ingredients businesses in Oceania and Sri Lanka, along with its Middle East and Africa Foodservice operations, Chairman Peter McBride said in a statement after the vote.
"We will be able to focus Fonterra's energy and efforts on where we do our best work. We will have a simplified and more focused business, the value of which cannot be overstated," he said.Fonterra added that completion of the divestment remains subject to certain regulatory approvals and the sale is expected to happen in the first half of 2026.
