Fonterra has sold its Soprole dairy business to Gloria Foods for 591.07 billion Chilean Pesos (NZ$1.055 billion) just over a year since the company flagged it was looking to offload the business.
CEO Miles Hurrell said the co-op was working to differentiate New Zealand milk on the world stage and the Chilean operations didn’t require New Zealand-sourced milk or expertise.
It owned Sorpole and its subsidiary Prolesur, which source milk and manufacture dairy products in Southern Chile.
The divestment process began in April, culminating in the sale to Gloria Foods - JORB S.A., a consumer dairy market leader in Peru, with operations in Bolivia, Puerto Rico, Argentina, Colombia and Uruguay.
Fonterra and Gloria Foods have a long-standing commercial relationship in South America.
The sale is subject to a number of conditions including regulatory approvals and an irrevocable public tender offer process in Chile for the outstanding shares in Soprole not already owned by Fonterra. Satisfaction of conditions is expected to take approximately six months.
Fonterra said its previously announced FY23 earnings guidance will continue to reflect only the underlying performance of the Soprole business during the pre-completion period. Fonterra will provide an update on the overall impact of its divestment programme as part of its FY23 financial reporting.
