Fonterra Co-Operative Group Ltd said on Monday it will sell its stakes in two joint-venture farms in China’s Shandong province to Singapore-based AustAsia Investment Holdings for NZ$88 million ($62 million).
The sale comes amid a retreat by the world’s largest dairy exporter since 2019 from an ill-fated overseas expansion that drew sharp criticism from its 10,000-plus farmer-shareholders.
Fonterra, which owns 51% of the two farms, said the sale is not subject to any regulatory approvals and is unconditional.
AustAsia, 75% owned by Singaporean agri-food company Japfa Ltd, will buy the farms outright for $115.5 million, with the difference being paid to Fonterra’s joint venture partner, the New Zealand co-operative said.
“Greater China continues to be one of our most important strategic markets. We remain committed to our China business,” Chief Executive Officer Miles Hurrell said in a statement.
The dairy giant in April sold two fully owned farms in China to Inner Mongolia Youran Dairy for NZ$552 million.
($1 = 1.4156 New Zealand dollars)
Reporting by Nikhil Kurian Nainan in Bengaluru; Editing by Kim Coghill and Christopher Cushing; Reuters