Who will buy a butter to Anchor their business
Credit: Fonterra
The ongoing sale or initial public offering of Fonterra‘s consumer business continues apace, with rumours flying about on which global dairy giant will snap up the consumer home of Anchor and Mainland butters, Kapiti ice cream and cheeses and the Anlene powdered milk supplement. The possible sale also includes the Fonterra Oceania and Fonterra Sri Lanka units, which include operations from milk collection to processing to supplying products to consumers and food-service companies. The operations account for about 19 per cent of Fonterra’s operating earnings in the first half of fiscal 2024. It is hoped that this will be decided by the middle of the year.
Reuters noted that Meiji of Japan, Saputo of Canada and French group Lactalis are all in the frame, which makes sense, really. I would not be surprised to see Yili Group throw its hat into the ring as well. A private equity firm is also said to be looking into it.
It does go to show that dairy is still a good investment and having a well-known set of brand names is a valuable asset for any company that decides to pick it up. Lactalis in particular has a regular method of buying the companies, wherever they may be, and running a profitable operation with the brands left intact.
The local brand is often well-regarded, and it can then be spread globally. Marketing campaigns can be used in more than one country and tailored for the local markets. Witness the global march of President Brie and Davidstow cheddar cheeses. Well, the latter brand is now Saputo, but the big dairy firms all appear to be having the same idea.
- Suzanne Christiansen, editor, Dairy Industries International.
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