As the two company’s strategic outlooks evolve, New Zealand’s Fonterra and European giant Nestle are reworking their 10-year old Dairy Partners Americas (DPA) joint venture in Latin America through a series of deals that will see Fonterra receive US$92 million from Nestle. After the shake-up Fonterra will end with a 51% controlling stake in DPA Brazil and Nestle will hold the remaining 49%. Additionally, Nestle will buy Fonterra’s stake in DPA’s milk powder business and its share in Ecuador, while Fonterra and its local partner will acquire Nestle’s stake in DPA Venezuela. Fonterra’s focus is shifting toward everyday nutrition in markets such as China, Indonesia, and Latin America and Fonterra’s Latin American business generates US$2.97 billion handling 900,000 tons of dairy products per year. The series of deals to restructure the joint venture are expected to be completed by the end of 2014.
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