December 9, 2009

Fonterra to buy Sadafco stake in Saudi dairy venture

New Zealand's Fonterra Cooperative Group Ltd. plans to buy out its partner in a Saudi Arabian processing venture.

Fonterra has a conditional agreement to buy the 51 percent of Saudi New Zealand Dairy Products Co. owned by Jeddah-based Saudi Dairy & Foodstuff Co also known as Sadafco.

No price was disclosed for the transaction, which is expected to close in January, said a Fonterra spokesman.

Saudi Dairy & Foodstuff is Saudi Arabia's third-largest food producer by market value. It said on Sunday (Dec 6) it may sell its holding in the processing venture, which produces cheese and milk powder.