Archer Capital-owned DairyWest buys Brownes from Fonterra

The transaction may be complete as early as 2011, and comes as Fonterra, the New Zealand-based conglomerate responsible for 30% of the world's dairy exports, says Brownes would benefit for a more regional focus.

"Fundamentally, Brownes is a regional business, and it is not receiving the right level of focus within Fonterra, given our decision to focus on national leadership in our priority categories of cheese, spreads, yoghurts and dairy desserts in Australia. Subsequently, the Brownes business will be better served as a stand-alone entity," Fonterra Brands Australia New Zealand MD John Doumani publicly said.

Reports of Fonterra's intent to offload the company surfaced earlier this year, coming eight years after Fonterra bought out the company from its then owners Peters and Brownes, which had picked up the company in 1990 via a MBO led by MD Graham Laitt. Local reports earlier this year suggested that a sale would be difficult, as Fonterra sought $60 million more than it first paid for the company. All Brownes' employees and existing farmer arrangements in the state are slated to be transferred to DairyWest.

 

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• Topics
• Australasia
• Buyouts
• Archer Capital