July 26, 2010
China's Bright Dairy buys stake in New Zealand's Synlait Milk
Bright Dairy & Food Co. has agreed to buy a controlling stake in Synlait Milk Ltd., a New Zealand milk processor planning to double capacity at its South Island plant.
Bright Dairy will pay NZD82 million (US$58 million) for a 51% in Synlait Milk, Synlait Ltd., its Christchurch-based parent company said.
Synlait, which last year shelved a share sale to fund expansion because of a lack of investor demand, said it will increase the capacity at its South Island plant to about 100,000 metric tonnes of milk powder a year. Some of extra production will be specialist infant formulas, which will be sold in China in partnership with Bright Dairy.
"Our strategy is all about us becoming a leading supplier of high value premium infant formula, particularly for the Asian market," Synlait CEO John Penno said.
The approval is subject to regulatory approvals, including foreign investment clearance. The company does not anticipate any objections because the proposal involves a processing asset and not farm land, Synlait chairman Graeme Milne said.