'Local' staff for milk-plant expansion

ALAN WOOD
Last updated 09:09 30/07/2013

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Synlait Milk will hire "locally" as part of a $180 million upgrade that will take total staff to about 370 in the next two years.

As part of a capital raising process, Synlait Milk has announced plans to invest about $180 million to upgrade the Dunsandel milk plant and build a packaging plant and new warehouse.

It plans to produce a specialist ingredient for infant formula, which is in high demand in China.

Synlait Milk has raise new capital during an initial public offer of shares. It is also restructuring its debt and planning $180 m of capital expenditure, part of growth initiatives planned for completion by 2015.

Managing director John Penno said the milk processor was still in the process of getting consents for a third large dryer for $110 m as part of the total expenditure at its Dunsandel processing plant, 40 kilometres south of Christchurch.

The nutritional dryer would be complete by August 2015, funded by a new debt facility with a syndicate of banks including BNZ and ANZ, and would help drive annual total milk product capacity at the plant from 100,000 tonnes to 135,000 tonnes.

At the same time the dryer is built it will spend $15 m extending its cream processing facilities to include making butter . Synlait Milk already has resource consents for a $15m lactoferrin extraction and purification facility with that project "well underway".

That investment would enable Synlait Milk to become one of only two manufacturers in the world to produce lactoferrin as a spray- dried powder to be added to products including infant formula and nutritional powders.

The manufacturer also planned a $27 m blending and canning plant, part of Synlait's consumer packaging strategy. Separately, it planned significant warehousing including an $11.8 m dry store to consolidate operations on the site.

"We're also establishing analytical laboratories out on the site," Penno said.

Synlait had about 160 staff, but in the next 12 months planned to increase that to 275, and then to 370 in the following year.

"We've found it increasingly straight forward to hire people . . . word of mouth has brought a lot of people and continues to," Penno said.

Apart from the debt for the dryer, Synlait would also hold a separate debt facility of $75 m.

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- © Fairfax NZ News

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