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.
Foreign Affairs Minister Winston Peters has joined the debate around the proposed sale of Fonterra’s consumer and related businesses, demanding answers from the co-operative around its milk supply deal with the buyer, Lactalis.
The ACT Party says media reports that global dairy giant Nestle has withdrawn from the Dairy Methane Action Alliance shows why New Zealand needs to rethink its approach to climate.
OPINION: Farmer shareholders of two of New Zealand's largest co-operatives have an important decision to make this month and what they decide could change the landscape of the dairy and meat sectors in New Zealand.
OPINION: As CEO of the Dairy Board in the 1980s I was fortunate to work with a team of experienced and capable executives who made most of the brand investments that created the international consumer business Fonterra inherited. Soprole in Chile was the largest, but there were more than 20 countries where consumer marketing companies were established and Anchor and other brands were successfully launched.
Fonterra has delivered a fifth straight year of record organic milk price for farmer suppliers.
Like many manufacturers around the world, European agricultural machinery and tractor manufacturers are currently operating in a difficult market environment. But they are heading to the world’s largest agricultural machinery event in Hanover next month with a degree of cautious optimism.
Established in 2021, the John Deere Technician of the Year Awards champion the important contribution parts and service technicians make to the Australian and New Zealand agriculture, construction and forestry industries.
Beef + Lamb New Zealand (B+LNZ) is calling on farmers from all regions to take part in the final season of the Sheep Poo Study aiming to build a clearer picture of how facial eczema (FE) affects farms across New Zealand.
New Zealand is closer to eradicating bovine TB than ever before, but possums remain a threat, says Beef + Lamb New Zealand.
Foreign Affairs Minister Winston Peters has joined the debate around the proposed sale of Fonterra’s consumer and related businesses, demanding answers from the co-operative around its milk supply deal with the buyer, Lactalis.
The ACT Party says media reports that global dairy giant Nestle has withdrawn from the Dairy Methane Action Alliance shows why New Zealand needs to rethink its approach to climate.
OPINION: Dairy industry players are also falling by the wayside as the economic downturn bites around the country.
OPINION: Methane Science Accord, a farmer-led organisation advocating for zero tax on ruminant methane, will be quietly celebrating its first…
