Fonterra sells its China dairy farms worth $368M to focus on the domestic market
On Monday, Fonterra (FCG.NZFSF.NZ) reported that it finally agreed to sell its dairy farms located in China for a total of 555 Million NZD ($367.97 Million). It added that it would continue to focus on its domestic market and reduce debt.
“For the last eighteen months, we have been reviewing every part of the business to ensure our assets and investments meet the needs of the Co-op today,” Fonterra’s Chief Executive Officer Miles Hurrell stated.
“Selling the farms is in line with our decision to focus on our New Zealand farmers’ milk,” he added.
China Youran Dairy Group announced that it would purchase Fonterra’s two farming hubs in Ying and Yutian for 513 Million NZD. Beijing Sanyuan Venture Capital said that it would also acquire an 85% stake in Fonterra’s farm located in Hangu.
In 2019, the New Zealand-based multinational dairy company announced it plans to halt all of its overseas expansion.
Fonterra was criticized by the more than 10,000 farmers who make up its cooperative due to its strange businesses in other countries like China and value-added consumer products that were weighing on the company’s revenue.