New Zealand based dairy co-operative Fonterra has agreed to acquire 18.8% stake worth $561.32m in Chinese infant formula manufacturer, Beingmate Baby & Child Food Company.
The co-operative group has purchased 192.4 million shares in the Chinese firm, paying RMB18 ($2.9) per share.
Fonterra chief financial officer Lukas Paravicini said that both companies had earlier made provision for the possibility of the Partial Tender Offer reaching slightly less than 20%.
Paravicini said: "Over the next few weeks, Fonterra and Beingmate will now move ahead with the next phase of our partnership, which includes establishing a joint venture to purchase the Darnum plant in Australia and finalising a distribution agreement making Beingmate Fonterra's exclusive Anmum distributor in mainland China."
The transaction is expected to be closed in the next few days.
In August last year, both the companies announced plan for a new partnership that aimed to create a fully integrated global supply chain from the farm gate direct to China's consumers, using Fonterra's milk pools and manufacturing sites in New Zealand, Australia, and Europe.
Fonterra recently started operating its new dairy ingredients plant in the Netherlands, with a capacity to produce 5,000 metric tonnes of whey protein and 25,000 metric tonnes of lactose per year.
Image: Fonterra offers various ingredient products, including milk powders, butter and cream products, cheese, hydrolysates and dairy protein ingredients. Photo: courtesy of Fonterra Co-Operative Group.
