Australian dairy ingredients processor, Burra Foods, has sold a 79 per cent stake in the company to Chinese dairy giant Fuyuan.
In return, the Gippsland dairy processor says it will gain unparalleled access to the world’s largest and fastest growing dairy market, as well as improved access to capital that will fund expansion projects.
Existing shareholders, which include Burra Foods’ founder, Grant Crothers and Japanese dairy distributor, ITOCHU Corporation, have maintained a combined 21 per cent interest in the company.
Crothers, who will be continuing in his role as managing director and CEO, said the new shareholder structure will provide Burra Foods with "vastly improved" access to new high value milk and nutritional powder markets, facilitating low risk growth up the value chain, and access to additional capital.
“We have always been about maximising value from the milk solids we collect and process and have taken a very cautious approach to China, appreciating the significant risks that come with the increasing opportunities available," Crothers said.
“There are only winners in this deal as the new structure enhances the future for our loyal milk supply partners, provides ongoing employment for our dedicated staff, while ensuring increased and stable supply to our existing customers whether they are located in Australia, Japan, China or other parts of the world.”
Fuyuan is owned by a number of investors with the largest shareholder being China Mengniu Dairy Co Ltd (Mengniu), a company listed on the Hong Kong Stock Exchange which manufactures and distributes dairy products throughout China.
