Fonterra announces intention to reduce Beingmate shareholding
Date 08.07.2019 | Category: News
Chief Executive Miles Hurrell says this decision is part of Fonterra’s three-point plan to turn around the business. “One aspect of this plan was to take stock of our business. As part of this, we have re-evaluated every investment, major asset and partnership to ensure they still meet the co-operative’s needs today. This started with a strategic review of our relationship with Beingmate, which has been disappointing. The first action in this review was bringing the distribution of Anmum in China back in-house under our management.
“We then ended the Darnum joint venture with Beingmate, bought back Beingmate’s share of our Darnum facility in Australia, and entered into a multi-year agreement for Beingmate to purchase ingredients from us. What remains is our shareholding in Beingmate Baby & Child Food Co., which we now view as a financial investment only. We have talked to a number of parties regarding the potential sale of our entire stake in Beingmate, but so far have been unsuccessful in finding a buyer. As a result of this, we are now considering selling part of our holding and, as required by local listing rules, need to pre-announce our intention.”
Subject to demand for the shares, under the Shenzhen Stock Exchange market rules it is only possible to sell up to 1% every 90 days directly on the exchange, or sell up to 2% in a single block every 90 days. Trades greater than 5% can be made to an individual party in an off-market transaction.
Added Hurell: “From here, it’s about making pragmatic decisions to get the best outcome for the Co-op from our holding in Beingmate. China will always be one of our most important markets. We’ve got a strong business there and are still very much focused on the areas in China where we can succeed.” For more visit Fonterra.com
Source: FonterraAuthor: COX