CHINESE-led consortium bought 79 per cent of Gippsland dairy processor Burra Foods.

A Chinese-led consortium has bought 79 per cent of Gippsland dairy processor Burra Foods.

Steady hand: Grant Crothers, who is to remain managing director, says market access from the deal will help stabilise the farmgate milk price.

International dairy farming group Inner Mongolia Fuyuan Farming will own the majority share in Burra, an ingredients business at Korumburra, subject to Foreign Investment Review Board approval.

Fuyuan, which produces 162 million litres of milk a year from 11 dairy farms in China, consists of several investors.

The largest is Hong Kong Stock Exchange-listed China Mengniu Dairy, which manufactures and distributes dairy products throughout China. The second largest is banking group Goldman Sachs.

Burra Foods founder and managing director Grant Crothers and Japanese dairy distributor ITOCHU Corporation have maintained a 21 per cent interest in the company.

“It’s a great balance, they are an ingredient company effectively selling milk, as we are,” Mr Crothers said.

“Their largest shareholder is a Hong Kong-listed entity, they are very accountable and have a diverse group of shareholders, including big global dairy companies and, interestingly enough, the Commonwealth Bank of Australia.”

The search for an investor started 12 months ago with an “open book” and received no genuine interest from an Australian party, he said.

Mr Crothers, who will remain managing director, said the market access from the deal would help stabilise the farmgate milk price. “I’ve spent my life paying a premium for farmgate milk and that will continue,” Mr Crothers said.

Stressing it was business as usual for dairy farmer suppliers, Mr Crothers said the investment would allow the business to move into higher-value nutritional powders and infant milk formula.

Burra started 25 years ago and manufactures 60,000 tonnes of product a year, with plans to grow to 100,000 by 2020. It has more than 170 suppliers and collects about 300 million litres of milk a year.

Mr Crothers was confident of approval from FIRB in the next two weeks

 

http://www.weeklytimesnow.com.au/agribusiness/dairy/chineseled-consortium-takes-big-slice-of-burra/news-story/609043ce32300ba8b36dca87584e13cf

3 Comments Add yours

  1. Les Eldridge says:

    WTF!!! why is all of our dairy and agriculture being sold off to the chinese and other asian countries. For what benefit to us? So we have now become Chinas food bowl.? very stupid move.

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  2. Astby says:

    It’s well time Austn. Govt. changed the ground rules. Like all the other vigilant countries & lovers of their own country & economies, do. In just one clean sweep the ‘tables turned’ to one single Austn. owning a mere 10.5% share. Have Austns. been groomed into ‘breathing a sigh of relief’ when we see Commonwealth Bank having some share? I wonder what miniscule allowance that would have been. 1%, 2%? Could be 0.5%. Aust. should be dictating terms no-one else. We hold the Gold not them. But we pander & settle for dregs. Why? Govt. are the only ones who can save us from ‘the empty house’ we are headed, by setting limits of Foreign ownership, eg. 40% in total. Other countries do far more for themselves this way. We would still remain the most attractive, regulated, stable ‘deal’ & global position in the World. But the ‘faithless’ likes of Crothers & the rest, puts greed & ‘rolling over’, easily first. The first thing Chinese did when their foot was in the door? – announced dropped milk solids by a wopping 10c.

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  3. Astby says:

    Govt. stepping in & setting limits of Foreign Ownership is the only thing that is going to save us from this feeding frenzy. Other countries do this, why don’t we see it. Always the Bridesmaid!

    Like

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