August 9, 2005

New Zealand dairy giant Fonterra strengthens domestic market position

New Zealand dairy giant Fonterra Co-operative Group, would acquire NZ$754 million (AUD678 million) of assets from New Zealand Dairy Foods Holdings, to increase the value of its Anchor butter and milk brand, according to a statement from both companies.

In return, Dairy Foods would buy $NZ416 million of Fonterra businesses, including its Meadow Fresh drinks and yoghurt arm.

Fonterra also recently took full control of Bonlac Foods, with the aim of optimising capacity at Bonlac Foods' plants and expanding milk supply.

About 1,500 Fonterra workers would join New Zealand Dairy Foods while 800 Dairy Foods staff would join Fonterra, the companies said.