BANGLADESH: Arla forms JV with local partner Mutual Foods
Arla sees growth continuing in Bangladesh
Dairy giant Arla Foods has merged its Bangladesh interests with local distributor Mutual Foods.
The companies have formed a joint venture to accelerate already strong sales growth of powdered milk in a national liquid and powdered milk market estimated at US$700m.
"We will plough US$40m into the joint venture over the next three years with an ambition to become the leader in this market," Sanayet Kabir Khan, CFO of newly-formed Arla Foods Bangladesh, told just-food.
He estimated the venture will see its market share rise from 20% to 30% in the next three years.
Mutual, which is also a manufacturer, has packaged and distributed Arla's Dano milk powder, a household brand in Bangladesh since the early 1960s. It commissioned a new packaging plant last December after sales of Dano quadrupled in four years.
Established in 1962, Mutual Foods, a wing of parent Mutual Group, also established global brand Horlicks in Bangladesh.
The joint venture, 51% majority owned by Arla, this week launched Dano Daily, low-priced milk powder sachets fortified with vitamins and minerals to supplement Bangaldeshi diets.
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