April 15, 2009
New Zealand's Fonterra Co-operative Group, the world's largest dairy trader and former partner of Sanlu Group, plans to buy Sanlu's shares in their joint-ventured dairy farm.
Henry van der Heyden, chairman of Fonterra, said Monday (Apr 13) his company, which owns 85 percent of the dairy farm in Tangshan, a city in north China's Hebei Province, planned to buy the remaining 15 percent owned by Sanlu, without indicating how much it plans to spend.
Sanlu's shares in the farm were put up for sale in the fourth and final planned auction of Sanlu's assets on Monday. However, the auction failed as bidders were deterred by the high prices.
Currently, the farm has 3,000 dairy cows, of which 2,400 have begun producing milk. Each cow gives an average of 8,000 litres of milk annually.
Sanlu Group was China's leading seller of milk powder for 15 years until the melamine-tainted milk scandal broke in September last year and it was declared bankrupt earlier this year for failing to repay outstanding debts. Fonterra had a 43 percent stake in Sanlu Group.
Sanyuan Group bought Sanlu's core assets at RMB616.5 million in the first auction on March 4.
US$1=RMB6.832 (Apr 15)