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Nestlé, Fonterra mull options for Brazilian dairy JV, including stake sale

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Nestlé, Fonterra mull options for Brazilian dairy JV, including stake sale

Nestlé SA and Fonterra Co-op Group Ltd. will review strategic options for their Brazilian joint venture, Dairy Partners Americas Brazil, including a potential sale of their stakes, according to a joint announcement May 22.

The JV markets brands such as Nestlé, Chamyto, Ninho, Chandelle, Chambinho, Neston and Molico in Brazil, where it has two plants and employ 1,400 people. In 2018, the company generated 1 billion Brazilian reais in sales.

Dairy Partners Americas was formed as a 50/50 JV by Nestlé and Fonterra in 2003 to market and commercialize dairy products throughout Latin America, until the companies realigned their ownership in 2014. Since then, Fonterra has held a 51% stake in the company, with Nestlé owning the remaining 49% stake.

The companies said the move is to ensure the long-term growth and success of the business. They expect to complete the review by the end of 2019.

As of May 22, US$1 was equivalent to 4.03 Brazilian reais.