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Fonterra completes sale of DPA to Lactalis
Fonterra and Nestlé have completed the sale of their Brazilian joint venture Dairy Partners Americas (DPA) to Lactalis. The competition organizations involved have now given their consent. On balance, Fonterra will be left with nothing.
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When the sale was announced in December 2022, Fonterra CEO Miles Hurrell already made it clear that the acquisition required approval from competition authorities. He may not have anticipated that it would take almost a full year before permission was granted.
Fonterra is pleased that the approval has now been granted. “Now we can concentrate our attention and resources on the activities we have identified as our core activities.”
DPA has been sold to France's Lactalis for around NZ$240 million (now around €133 million). Unfortunately, there is not much net left over for Fonterra (and Nestlé), because the sales proceeds are about just enough to pay off the debts. In addition, there is a negative foreign exchange reserve of NZ$70 million (€36 million), which must be settled somewhere in Fonterra's books for the current year. .
Fonterra was the largest shareholder in DPA, with 51% of the shares. Nestlé owned 49%.