increase font size
FONTERRA AND NESTLÉ have realigned their 10-year old Dairy Partners Americas (DPA) 50/50 joint venture and signed binding agreements covering the revised scope of the alliance.
Under the agreements Fonterra will take a 51% controlling stake in DPA Brazil, with Nestlé holding the balance and Fonterra together with a local partner will acquire Nestlé's share of DPA Venezuela.
Fonterra will also sell its share in DPA's milk powder manufacturing business to Nestlé and
Nestlé will buy Fonterra's share in DPA Ecuador.
Fonterra's chief executive, Theo Spierings, says the DPA joint venture has performed well for 10 years and now the time is right to realign the partnership to better reflect the respective strategies of Nestlé and Fonterra in the region.
He says the revised alliance supports Fonterra's group strategic focus on everyday nutrition in key growth markets such as Latin America, China and Indonesia.
"We value our relationship with Nestlé and this high-quality agreement will see our successful alliance continue. The deal also enables the cooperative to drive more long-term value in the region for its farmer shareholders," he says.
Fonterra's managing director of Latin America, Alex Turnbull, says: "The region's economies have undergone considerable change during the past 10 years. We've seen increased prosperity in markets like Brazil with rapid urban growth and a focus on healthy nutrition driving demand for dairy products.
"A bigger stake in DPA Brazil means we will be well placed to drive our volume and value growth strategy focusing on everyday nutrition offerings."
Fonterra's Latin American footprint drives more than 900,000 metric tonnes of volume per year and $3.5 billion (NZD) in revenue from consumer dairy, foodservice and dairy ingredients.
"We are very proud with what we've achieved through the DPA joint venture with Nestlé and are looking forward to continuing to work together with renewed focus," says Turnbull.
The changes to the joint venture are subject to regulatory approval. As a consequence of the realignment, Fonterra expects to receive about $96 million (NZD) in the next financial year.
About Dairy Partners Americas
Set up in 2003, Dairy Partners Americas is the largest dairy company in South America, purchasing and processing more than two billion litres of milk each year in Brazil alone. DPA produces ingredients and consumer products with strong brands in the liquid and chilled dairy market throughout Latin America.
Fonterra licenses brands and provides its large-scale milk procurement, product development, and manufacturing and processing expertise, as well as technical services and certain technology to the alliance.
Nestlé licenses brands and provides its product development, manufacturing and processing expertise, as well as distribution infrastructure to the alliance.
In the past, much has been made of the concept of farm to fork, but an Australian expert in food science and marketing with experience in the dairy industry, Dr Angeline Achariya, says the reverse of this slogan is critical to win modern day consumers.
A four year trial has reaffirmed that mixing plantain into dairy pastures can help reduce nitrogen losses to freshwater while maintaining milk production and profitability, say researchers.
Fonterra has opened its upgraded Chengdu Application Centre, bringing New Zealand dairy expertise closer to customers in one of China's fastest-growing regions.
Tatua chair Stephen Allen says he leaves the co-op with a deep sense of gratitude for the people who have contributed to its success.
Federated Farmers president Colin Hurst and his family raised a glass of milk last week to toast the start of a new addition to their farming operation at Makihihi, south of Timaru.
Celebrating 50 years in the rural landscape of Central Canterbury and beyond, Ashburton-based Carrfields, has been the exemplar for all aspects of modern agriculture via its extensive range of services including supply, growing, agronomic advice and marketing.
For Taupiri dairy farmers Logan and Sian Dawson, their involvement in the NZ Dairy Industry Awards has been a key catalyst in the growth of their business - the experience helping shape how they approach the farm ownership pathway they are pursuing today.
West Otago dairy farmer Luke Kane has been awarded the 2026 Rabobank Dr John Morris Business Development Prize.
OPINION: As the general election approaches, political parties are churning out policies in the hope of attracting more votes.
An LIC bull, Tronnoco AR Sadio-ET S3F, bred by Tony and Keri O'Connor of Tronnoco Farming Co Ltd near Timaru, has won the 2026 Mahoe Trophy.
With forecasters advising El Niño conditions will develop through winter and strengthen into spring and summer, Ballance Agri-Nutrients is encouraging farmers and growers to think ahead about nutrient planning and be prepared to work around challenging weather conditions.
OPINION: After hogging the media limelight for telling a NZ Chinese MP to "go back home", Winston Peters has decided…
OPINION: With fuel prices soaring, one would have expected most farmers to be reclaiming excise duty on petrol.
