Nestlé (Malaysia) Bhd., a unit of Swiss food and beverage giant Nestlé SA, said Oct. 9 that it will sell its chilled dairy business to French dairy products producer Groupe Lactalis SA.

Financial terms of the transaction were not disclosed in the release, but Reuters reported that the deal is valued at 155.3 million ringgit.

Nestlé Malaysia, which recently named a new CEO, said Lactalis will also take over manufacturing operations of its Petaling Jaya factory.

Lactalis plans to make Malaysia its operations hub for its ASEAN dairy business, the consumer goods company said.

Nestlé Malaysia will transfer all existing Milo manufacturing operations from the Petaling Jaya factory to its Milo factory in Chembong, where it plans to invest over 100 million Malaysian ringgit to expand the facility.

Nestlé's Chembong plant supplies Milo in Malaysia and exports to over 20 countries, according to the announcement.

Lactalis was last month reported to be in talks with South African pharmaceutical company Aspen Pharmacare Holdings Ltd. to acquire the latter's global infant nutritionals business. The French company is currently in the middle of an investigation into a salmonella outbreak that led to dozens of babies falling ill last year, Reuters Africa reported Oct. 9, citing the Paris prosecutor's office.

As of Oct. 9, US$1 was equivalent to 4.16 Malaysian ringgit.