Friesland acquires Olam dairy

AGRI-BUSINESS company, Olam International Limited has been restructuring its Dairy Products portfolio to focus on upstream and midstream sections of its dairy business. As part of this activity, the company has sold its dairy processing plant in Cote d’Ivoire to Dutch dairy cooperative, Royal FrieslandCampina (Friesland). The companies have agreed on a cash consideration of US$18.7 million, which does not include any working capital delivered at the closing of the transaction. Apart from the sale, Olam will assign its trademark “Pearl” for $6.3 million. This transaction will give Friesland the right to use the trademark for sweet condensed and evaporated milk products in certain designated countries in Africa.

The dairy plant, which was established in 2011, produces sweetened condensed milk and evaporated milk for local consumers. Olam expects to book total cash inflow of $25.0 million and a one-time pre-tax gain of $10.0 million upon completion of the transaction in Q2 FY2015.