Fonterra Australia has agreed to purchase cheese processor Dairy Country for AUD 19.23 million ($14.03 million approx.) from food and beverage company, Retail Food Group.
Fonterra claims to hold a 23% market share in the ‘AUD 2.6 billion Australian retail cheese category’. The company expects the acquisition to help drive efficiencies in its Australian cheese business, which includes brands such as Perfect Italiano, Mainland and Bega.
The deal includes Dairy Country’s processing and packing facilities at Campbellfield and Tullamarine in Victoria, along with related services, intellectual property and the trademark for the Dairy Country brand.
“This acquisition is a logical choice and further supports our strategy to be customer- and consumer- led, while ensuring we keep pace with the fast-growing cheese category in Australia,” said Fonterra Australia managing director, René Dedoncker.
“Dairy Country has two well-equipped secondary processing sites with capability across grating, shredding and block, as well as an experienced workforce.
“For some time we have been looking to bring more of our secondary cheese processing in-house to gain greater end-to-end control over a range of different cheese products and further strengthen our integrated supply chain.
“Having this kind of capability in-house will enable efficiencies and allow us to make the most of opportunities for value creation and product innovation.”
The ‘majority’ of Dairy Country’s permanent employees will reportedly transfer to Fonterra and continue to work at the Campbellfield and Tullamarine facilities.
The transaction is subject to regulatory approvals and standard closing conditions.