Fonterra, a dairy co-operative in New Zealand, has purchased a 6% stake in Australian dairy firm Bega Cheese for A$46m.
As per the deal, the New Zealand co-operative purchased 9.3 million shares at AUD4.95 per share.
Fonterra CEO Theo Spierings said, "Australia is an important market for Fonterra, and we are committed to growing our already strong presence.
"There has recently been a lot of consolidation activity in the Australian dairy industry," Spierings added.
"It is important that Fonterra participates, and we have confidence in Bega and the strategy it is pursuing."
Fonterra currently owns Bega brand license with a substantial supply contract for cheese. It sells cheese, yogurts and dessert products in Australia, and has a strong presence in milk powder and other dairy ingredients segments.
The company is reportedly seeking to boost its share in Bega to close to 10%.