Bakers prefer butter, helping prices soar
Consumers around the world are willing to pay more for products containing dairy and this is driving demand for butter and cream, says Fonterra.
He told the co-op’s annual meeting in Invercargill today that selling Tip Top wasn’t easy.
“We knew it wouldn’t be a popular decision with some of you, but it was the right call.
“Was it an iconic business? Yes. Was it on strategy and a key part of our future? Definitely not.
“Once we took the emotion out of the process, making that call was easy: we divested it as a mature asset for a great price.”
Monaghan says Froneri has retained all former Fonterra employees, who have kept their jobs as part of the deal.
Fonterra has used the proceeds to help reduce debt levels and give it more options for the future.
It has sold its stake in Venezuelan consumer joint venture, Corporacion Inlaca, and its 50% share of DFE Pharma – a joint venture with FrieslandCampina.
“We are considering our options for our ownership of our China Farms, Dairy Partners Americas which is our joint venture in Brazil, and have begun the process of sellingdown our 18.8% shareholding in Beingmate.”
