New Zealand dairy giant Fonterra will buy a 20% stake in Chinese dairy giant Beingmate to increase its access to China’s infant milk market, Beingmate has announced. 

The company says Fonterra will invest 3.68 billion yuan (€462.2m) to become Beingmate’s major shareholder. The deal is expected to be completed within a month, following approval by China’s Securities Regulatory Commission.

Fonterra and Beingmate will set up a joint venture to purchase Fonterra’s Darnum plant in Australia and will establish a distribution agreement to sell Fonterra’s Anmum brand in China. Beingmate will invest more than US$185 million (€142.8m) in the factory, in which it will have a 51% share. Beingmate is based in Hangzhou, capital of east China’s Zhejiang Province, and is the third-biggest Chinese dairy firm, production-wise.

“China is our number one market and the proposal to join forces with Beingmate will be an important building block in Fonterra driving volume and value, and taking a step forward in terms of being a globally relevant co-operative,” notes Theo Spierings, Fonterra’s chief executive.

Source: dairyindustries.com