23 Jan 2020

Fonterra finalised sale of DFE Pharma share

11:43 am on 23 January 2020

Fonterra will bank a total of $554 million from the sale of its share in the European based in pharmaceuticals company DFE Pharma, but still expects further asset sales.

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Photo: 123RF

It said the sale of its 50 percent stake to investment company CVC has been finalised, and it will get cash proceeds of $537m along with another $17m in adjustments.

Fonterra and Dutch-based FrieslandCampina set up DFE Pharma in 2006 and it is one of the largest suppliers of pharmaceutical bulking agents in medicines such as tablets and powder inhalers.

Fonterra said the sale, announced last year, would bolster its finances, as it looks to cut debt, costs, and concentrate more on its home markets.

It also sold its Tip Top ice cream business last year.

Chief financial officer Marc Rivers said there were likely to be more one off asset sales as it restructures its business, after two years of losses and massive writeoffs.

"It is too early to assess the overall impact of these on the Co-op's 2020 financial year."

Fonterra has put its 17 percent holding in Chinese infant formula maker Beingmate up for sale, and is also reviewing its stake in a Brazilian joint venture with Nestle.