Fonterra to acquire Anchor, Fresh’n’Fruity Brands in NZ
Under an agreement Fonterra will acquire from NZDF, the Anchor Milk and Fresh’n’Fruity yoghurt brands, and will sell its Meadow Fresh beverages and yoghurts and its Kiwi Meats businesses to NZDF.
08/08/05 Fonterra and New Zealand Dairy Foods (NZDF) have reached an agreement that will return the iconic Anchor Brand to Fonterra’s product range in New Zealand, thereby aligning its international brand portfolio.
Under the agreement Fonterra will acquire a range of assets from NZDF including the Anchor Milk and Fresh’n’Fruity yoghurt brands and will sell its Meadow Fresh beverages and yoghurts and its Kiwi Meats businesses to NZDF.
The assets acquired by Fonterra from NZDF are valued at $754 million and the assets acquired by NZDF from Fonterra are valued at $416 million.
NZDF said it recognised the logic of Fonterra’s strategy in wanting to align its domestic brands with its international profile and while NZDF was acquiring a business with a lower profit base, it considered the Meadow Fresh and Kiwi Meats businesses to be very well run operations and well positioned in the New Zealand market.
Under the details of the agreement:
- Fonterra will acquire most of NZDF’s assets (the principal exclusions being Puhoi Cheese and NZDF’s cheese business which will have use of the Anchor brand under a 10 year license)
- NZDF will acquire Meadow Fresh beverages, yoghurts, the Kiwi Meats businesses and the route (fresh milk deliveries) and food services and distribution networks
- Fonterra will retain the Mainland cheese and export businesses.
The agreement sees Fonterra gain the rights to much of New Zealand’s Anchor branded products. Fonterra currently owns the Anchor brand outside New Zealand but Anchor in New Zealand was part of NZDF when it was sold to allow the merger that formed Fonterra to proceed.
Fonterra Brands Managing Director Sanjay Khosla said the Meadow Fresh and meats businesses are good performers and their strength was a key asset in this transaction.
The parties have agreed to settle on August 31.
