Battle for milk
OPINION: Fonterra may be on the verge of selling its consumer business in New Zealand, but the co-operative is not keen on giving any ground to its competitors in the country.
That’s according to Fonterra Oceania managing director David Breckenridge.
Fonterra’s $4.2 billion sale of the Mainland Group to Lactalis is expected to clear final regulatory hurdles in the coming weeks.
This will see 4,200 employees involved in the integrated foodservice and ingredients businesses in Oceania and Sri Lanka; and the Middle East and Africa foodservice business, move over to Mainland Group. In Australia and New Zealand, the move will involve 2500 employees.
Speaking to Rural News at the Australian Dairy Conference in Melbourne, Breckenridge says he expected the transaction to close by the end of March this year.
“That means that most of the milestones that needed to be hit, have been hit,” he says.
In Australia, Mainland Dairy will continue to collect milk from 460 farmers and process at eight manufacturing sites across Victoria and Tasmania.
Mainland Dairy will become new owners of well-known Australian brands like Perfect Italiano, Mainland, Western Star, and Bega.
Breckenridge says the leadership team, field staff and service offerings will remain the same.
“The transition for our Australian business, if you take all the corporate ownership changes out, there really isn't a lot of change other than changing the logos on shirts.
“So, the transition from that perspective is very easy for our Australian business.
“We're not breaking it up in any way: we're simply changing the brand on the shirts from Fonterra to Mainland Dairy.
“So, everything from our factories, our brands, our team, other than the merchandise with Fonterra logo on it, remains the same.”
Fonterra’s presence in Australia will be limited: the co-op will retain access to a small number of customers.
Mainland Dairy will act as a distributor for Fonterra products into Australia.
The imminent departure of Fonterra from Australia is evident at the Australian Dairy Conference. Normally, a major sponsor the co-operative’s name is nowhere to be seen. Mainland Dairy is one of the two major partners of the conference this year.
Sudesh Kissun is at the Australian Dairy Conference courtesy of Halter.
