Fonterra sells stake in AFF joint venture

Fonterra Cooperative Group, the world’s largest exporter of dairy products, has sold its stake in a joint venture to market Anchor products.

Fonterra sold its 25 percent interest in AFF for an undisclosed sum to majority owner Arla Foods.

The deal will have "positive balance sheet impact" for the company, according to chief financial officer Jonathan Mason.

The stake had a carrying value of $67 million as at July 31, according to the dairy company's annual report.  

Mason said the venture had been successful, but was "no longer core to the long-term strategy" of growing value-add ingredient sales and boosting regional business in Asia, Australasia, South America and the Middle East.  

Fonterra will keep using Arla to license its Anchor brand and supply New Zealand butter in the U.K.  

AFF was set up in 2002 with Arla Foods to market block butter, spread and aerosol cream products in the U.K. 

-BUSINESSWIRE