Tuesday, 04 December 2018 11:55

Tip Top to go on the block?

Written by  Sudesh Kissun
Fonterra’s review of assets could see it sell Tip Top. Fonterra’s review of assets could see it sell Tip Top.

New Zealand’s favourite ice cream brand could soon be sold.

Fonterra says its asset review process is well underway, but there’s nothing to announce right now.

A Fonterra spokesman says people will speculate on “what all this could mean”.

“When we are ready, we’ll be open with our people, farmers and the market about any changes,” the spokesman told Rural News.

“We are taking a close look at our current portfolio and reviewing all of the co-op’s investments, major assets and partnerships against our strategy. 

“This includes assessing their return on capital and whether there is opportunity to scale them up and grow more value over the next two-three years.”

Media reports have named the New Zealand ice cream business Tip Top and the South American subsidiary Soprole as the two value-add businesses under review, along with its disastrous investment in Chinese baby food company Beingmate. 

Fonterra’s strategic review emanates from its 2017-18 net loss of $196 million, the first in its history; the co-op aims to reduce its debt levels by $800m to protect its balance sheet. 

Included in the review is Fonterra’s 18.8% holding in China’s Beingmate, whose poor performance and internal power struggle forced the co-op to write down the value of its investment by $405m from the original $750m paid.

Fonterra chairman John Monaghan told the co-op’s annual meeting recently that the reduction cannot be achieved by improved performance alone.

“We need to divest assets to meet that commitment,” he said.

» Connect with Rural News

More like this

Independence necessary — Editorial

OPINION: News that a group of Fonterra farmers want an independent review of the Fonterra shareholders council may well be the beginning of the end of its ‘lapdog’ reputation.

Fonterra lifts milk price

Good news for Fonterra farmers – the co-op is increasing its 2019-20 forecast farmgate milk price by 30c/kgMS.

Watchdog or lapdog?

More Fonterra farmers are joining the call for an independent review of the co-op’s shareholders council.

Lack of interest

The final list of candidates for Fonterra’s board election is out. Surprisingly only one candidate came through the farmer nominated process.

» The RNG Weather Report



A resource not a pest

A conservation and hunting lobby has criticised a call by Environment Canterbury for more funding to prevent a national plague of wallabies.

» Connect with Rural News

» Connect with Rural News

» The RNG Weather Report

» Latest Print Issues Online

The Hound

Told ya!

OPINION: As pointed out in this column a while back, a new special agricultural trade envoy (SATE) has now been appointed…

How come?

OPINION: This old mutt is somewhat conflicted over the $3 billion Provincial Growth Fund (PGF) overseen by the king of pork…


» Connect with Rural News