The world's biggest dairy exporter, Fonterra, is considering selling its Australian business via an IPO, eight months after it lost a trademark stoush over the use of the Bega Cheese brand.
Fonterra, a New Zealand dairy co-operative, entered the Australian market in 2005 after taking over Victorian milk producer Bonlac and buying Nestle's factory in the state's south-west.
On Thursday chairman Miles Hurrell announced an ownership review, which includes an IPO of the Australian business. Under that option, Fonterra would retain a "significant stake" in the business.
“By having access to ongoing external capital, we believe the Australian business will be best placed to deliver on its strategy and capture its full potential, at the same time as unlocking capital for the co-op," Mr Hurrell said.
“The strength of the Australian business has been demonstrated through recent results and execution of its strategic plan. Under the leadership of René Dedoncker, the Fonterra Australia management team has a clear strategy to maintain the business’s current momentum, supported by continued investment in product mix and growth."
It comes after Bega Cheese won its four-year legal battle with Fonterra in February, with the Supreme Court ruling the NSW-headquartered company can use its own trademark on products outside its licensing agreement with the New Zealand dairy giant.
