Fonterra buys NZ Dairies’ milk powder plant from receivers   15 Jun 2012

Article - BusinessDesk

Fonterra buys NZ Dairies’ milk powder plant from receivers

May 18 (BusinessDesk) – Fonterra Cooperative Group has agreed to buy the South Canterbury milk powder plant of New Zealand Dairies, the Russian-owned company the went into receivership last month.

No price was disclosed for the plant at Studholme, which can process about 150 million litres of milk a year. NZ Dairies and related companies Studholme Corp and Dairy Exports New Zealand were placed in receivership by secured creditor VTB Capital, a Moscow-based investment bank.

Fonterra chief executive Theo Spierings said the factory will complement the cooperative’s new plant at Darfield, which is due to start processing milk in August.

Fonterra” has clearly identified the importance of growing milk volumes and optimising our New Zealand manufacturing operations,” he said.

As part of the deal NZ Dairies’ existing farmer-suppliers will be offered the opportunity to supply Fonterra on contract and become shareholders within six years, it said.

Earlier this year, NZ Dairies' Russian parent Nutritek was declared bankrupt after missing repayments on a 403 million ruble loan to Russian lender UniCredit. Nutritek was set up in 1990 and had operations in Russia and the Ukraine, as well as the New Zealand milk processing factory.

Receivers Colin Gower, Stephen Tubbs and Brian Mayo Smith of BDO Chartered Accountants weren’t immediately available to comment.

The purchase is subject to Commerce Commission approval.

(BusinessDesk)

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