Arla sells its share in Vigor

d19e78a1-406a-41c5-a33d-aa41d19f0503articleimage.jpg

06 Nov 2017 --- Following a change in ownership of Brazilian dairy company Vigor S.A., Arla Foods has decided to divest its eight percent share in the company with immediate effect. Brazil’s leading dairy company Vigor S.A. has been sold by majority shareholder JBS S.A. to Mexican dairy company Grupo Lala S.A.B. de C.V.

In connection with this transaction, Arla Foods has sold its eight percent share in Vigor to Lala.

“Arla has operated in the Brazilian market for decades, however a co-ownership of Vigor no longer serves our strategic purpose. Our decision to divest is the best solution for Arla as we continue to focus our strategic investments on creating sustainable growth through our business in Asia, Africa, the Middle East and the USA,” says Executive Vice President in Arla Foods, Tim Ørting Jørgensen, who is responsible for Arla’s international business.

Vigor is the largest dairy company in Brazil. In 1986 Arla entered a 50/50 joint venture partnership with Vigor under the name Dan Vigor, which consisted of local cheese production under the Danubio brand. In 2014, Arla exchanged the joint ownership of Dan Vigor for an eight percent share in Vigor.

Further terms and conditions of the transaction are not disclosed. However, back in August FoodIngredientsFirst reported that the transaction is subject to certain approvals by Grupo Lala's shareholders' meeting, governmental authorizations, shareholder agreement, and other contractual conditions.

Financing for the transaction will likely include a bridge loan, followed by a combination of long-term debt and additional equity of approximately US$550 million, of which an estimated US$315 million will be committed by Lala's current shareholders.

The Lala Group’s Board of Directors agreed to propose to company shareholders the acquisition of up to 100 percent of the shares of Brazilian dairy giant, Vigor Alimentos, S.A. and the shares of Itambé Alimentos, S.A. for an implied value of R$5,725m (US$1.84bn).

FoodIngredientsFirst also reported how the Mexican-based Lala Group, was looking to seal a deal to buy control of Vigor Alimentos with a Board of Directors meeting scheduled to finalize the acquisition. You can read the full story here

It said in a statement that a proposal to acquire Vigor from investment holding company J&F Investimentos SA, as well as a borrowing plan and potential share offering, would go before the Board.

Related Articles

Food Ingredients News

DSM, Ingredion and Arla among FiE Awards winners, but no outright prize

29 Nov 2017 --- Major ingredients suppliers DSM, Ingredion and Arla were among the category winners at this year’s FiE Awards, but there was some surprise at last night’s event as no outright winner was announced. Unlike in previous years, when an overall award was given for true excellence in the ingredients space, this year’s event saw little distinction created between the wide range of category winners that were arguably of varying levels of innovation.

Food Ingredients News

FiE 2017 Innovation Awards: Life Stages and Growth categories – the nominees

20 Nov 2017 --- Last week, FoodIngredientsFirst took a look at some of the award nominees for the Reduction & Reformulation Innovation Award and the Sustainability and Organic Champion Award as well as the clean Label & Natural Innovation Award. On 28 November, the winners of this year's FiE Innovation Awards will be announced at the world's largest food and beverage ingredients show. 

Food Ingredients News

Dairy committed to global nutrition and environmental goals

01 Nov 2017 --- World political and agricultural leaders were told that dairy is committed to playing a vital dual role in feeding the world with nutritious foods – and protecting the environment. Speaking at the International Dairy Federation (IDF) World Dairy Summit in Belfast, earlier this week, Dr. Judith Bryans, President of the IDF, said the global dairy community is one billion people strong and is currently feeding 6 billion consumers.

Food Ingredients News

Arla goes Pro with launch of new foodservice division

20 Oct 2017 --- Arla Foods has launched its new foodservice division, Arla Pro, which was created especially for chefs. The launch happened at Dinerama, a global street food market in Shoreditch, London, UK.

Food Ingredients News

Arla launches organic milk in the Middle East

26 Sep 2017 --- Arla Foods has launched its first branded organic milk in the Middle East, the company’s biggest strategic growth market outside Europe, marking a significant milestone in its growth agenda. The launch of Arla Organic Milk in the UAE forms part of the farmer-owned company’s ambitious business strategy, which is to become the number one organic dairy brand in the Middle East and North Africa by 2020.

More Articles