Fonterra's Beingmate deal to close soon
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E-mail Shanghai Daily, March 17, 2015
New Zealand's largest dairy exporter Fonterra Group has completed a tender offer for a US$553 million deal to buy 18.8 percent in Chinese baby formula maker China Beingmate Baby and Child Food Co to boost its presence in the Chinese dairy industry.
Fonterra said yesterday that the transaction would be closed in the next few days now that the tender offer was completed. It said it paid 18 yuan (US$2.88) per share for 192 million shares in the Chinese baby formula producer.
The New Zealand dairy giant said it's confident of raising its stake in the Chinese company to 20 percent.
"Over the next few weeks, Fonterra and Beingmate will move ahead with the next phase of our partnership, including establishing a joint venture to purchase the Darnum plant in Australia and finalizing a distribution agreement making Beingmate Fonterra's exclusive Anmum distributor in China's mainland," Fonterra Chief Financial Officer Lukas Paravicini said in a statement.
Beingmate was suspended from trading starting yesterday, pending the official closing of the deal, said a stock exchange filing yesterday.
Fonterra first made the tender offer in August, and had originally sought a 20 percent stake in Beingmate.
China's infant formula market surged 24 percent last year to US$18 billion, said researcher Euromonitor, as consumers were willing to pay a premium for high-quality products.
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