June 10, 2008

Russia's Nutritek obtains majority stake in New Zealand Dairies

Russian baby food group Nutritek has acquired a 51.52 percent stake in New Zealand Dairies (NZDL) and intends to further increase its shareholding.

At the end of May, Nutritek was granted approval by the Overseas Investment Office of New Zealand to buy 100 percent of the dairy.

Nutritek said that it has "firm agreements" in place to continue to grow its share over the next year.

Nutritek chairman George Sazhinov said that, in taking a majority stake in NZDL, Nutritek had reached a fresh milestone in its plans to invest in Asia-Pacific.

The company said it would now proceed with plans to add further production facilities to the plant at Studholme, South Canterbury.

The approval of the sale by the Overseas Investment Office has drawn flak from farmers who questioned the need to sell a company that is virtually at the heart of the nation's economy.

The Overseas Investment Commission ruling said the sale would provide new job opportunities and introduce into New Zealand new technology or business skills while enlarging the country's exports and creating greater market competition and efficiency in the country.

Nutritek is a rapidly growing Russian company with a current capitalisation of about $US800 million operating in baby foods, one of the most highly specialised segments of the food industry.