Monday, 02 November 2015 15:23

Fonterra says bye to Bega shares

Written by  Sudesh Kissun

Fonterra has sold its 9% stake in Australian cheese processor Bega Cheese for A$74 million.

The co-op purchased its shareholding in 2013, amid a takeover battle for Australian processor Warrnambool Cheese and Butter; Bega unsuccessfully bid for WCB.

Fonterra chief financial officer Lukas Paravicini says they are focused on investing in higher value add dairy products that deliver the best returns for shareholders.

Releasing capital, such as through this sale, for future growth is the best use of our shareholders' funds, he says.

The sale of Fonterra's shareholding has no implications for its long-standing relationship with Bega, which includes a license on the Bega brand and a supply contract for cheese.

"The Bega brand has an important role in our cheese portfolio where we are a market leader, and we will continue to build on our relationship with Bega which goes back more than a decade," says Paravacini.

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