16 May 2024 10:35 am Views - 4491
“We have conducted a strategic review, which has reinforced the role of our core business,” said Fonterra chairman Peter McBride. “This is working alongside farmers to collect a sustainable supply of milk and efficiently manufacture products valued by customers, to deliver strong returns to farmer shareholders and unit holders.”
With the planned divestment, the cooperative intends to focus on being a B2B dairy nutrition provider, prioritising its ingredients and foodservice channels.
“While these are great businesses with recent strengthening in performance and potential for more, ownership of these businesses is not required to fulfil Fonterra’s core function of collecting, processing and selling milk,” said Fonterra CEO Miles Hurrell.
“Due to our cooperative structure, we believe prioritising our ingredients and foodservice channels and releasing capital in our consumer and associated businesses would generate more value.”
Fonterra will appoint advisors to assist with assessing divestment options.
The cooperative has also withdrawn its financial targets and decided to terminate its on-market share buyback program, which had been expected to run until August 13.
With the changes in direction, Fonterra global markets CEO Judith Swales has decided to leave the cooperative, effective July 1.
“Judith has always been a strong advocate for the voice of the customer, and her dedication has set our consumer business up for future success,” said Hurrell.