September 7, 2004

 

 

New Zealand Dairy Exporter Closing In On China Deal
 

New Zealand dairy exporter Fonterra has said it was close to completing a bid to buy a stake in a major Chinese dairy producer.

 

Patrick Kwok, general manager of Fonterra Ingredients China, told businessmen at a conference in Auckland that the company's deal with Shijiazhuang Sanlu Group Coy Ltd. was "really close" to being wrapped up, newspapers said.

 

A company spokesman said Tuesday "talks are continuing," but declined to elaborate.

 

Fonterra - New Zealand's largest private company - has said it wants a stronger foothold in China and the rest of Asia. It is reported earlier this year that Fonterra was negotiating to buy a 39 percent stake in Sanlu, which is among China's top 10 consumer dairy companies.

 

"We view Sanlu as a long-term commitment. It's not about just five or 10 years," Kwok was quoted as saying.

 

Fonterra is the largest exporter of dairy products to China. It has a market share of up to 70 percent in key products such as dairy ingredients.

 

It also owns a consumer dairy products company in China, and earned US$188 million in sales there last year.

 

Fonterra exports more than 7 billion New Zealand dollars (US$4.5 billion; euro 3.7 billion) worth of dairy products a year.

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