AMSTERDAM, Sept 1 Dutch farming cooperative
Royal FrieslandCampina, one of the five largest dairy companies
in the world, said on Monday it will buy the Ivory Coast dairy
businesses of Singapore's Olam International.
The acquisition fits into the growth strategy of leading
dairy producers to boost activities in emerging markets in
Africa and Asia, and counterbalance more limited long-term
growth in developed markets.
In July, France's Danone bought a 40 percent stake in
Kenya's Brookside, east Africa's top dairy producer, as part of
plans to expand in new markets while growth is weak in Europe.
Last week, New Zealand's Fonterra, the world's largest dairy
producer, said it would take a stake in Chinese baby food and
formula maker Beingmate.
In a separate statement, Olam said FrieslandCampina was
paying $18.7 million cash for the business and $6.3 million for
the right to use Olam's "Pearl" trademark in certain African
Olam said it expected to book a one-off pre-tax gain of
about $10 million when the transaction is completed in the
second quarter of its 2015 financial year, or the three months
ending Dec. 31, 2014.
The acquisition includes a dairy production facility in the
Ivorian commercial capital Abidjan that employs 80 people. It
processes local fresh milk and milk powder into sweetened
condensed milk and evaporated milk for the local market.
"(The acquisition) enables us to further strengthen our
position in West Africa," said FrieslandCampina chief executive
Cees 't Hart. The company already has a presence in the West
African countries of Ghana and Nigeria.
Olam said the sale was part of a plan to focus its dairy
products portfolio on upstream and midstream parts of the dairy
business. It has dairy farms in Uruguay and Russia.
FrieslandCampina has more than 21,000 employees and annual
revenues of more than 11 billion euros ($14.4 billion).
($1 = 0.7612 Euros)
(Reporting By Thomas Escritt; editing by David Clarke)