Australian food group Goodman Fielder has signed a deal to sell its Champion Milling business in New Zealand to Japan’s Nisshin Flour Milling.
The NZ$51m (US$42.4m) deal with the subsidiary of Nisshin Seifun Group is in line with Goodman Fielder’s strategy to “optimise” its portfolio and “further strengthen” its financial position, it said today (7 December).
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The company has also structured a long-term supply partnership with Nisshin to ensure Goodman Fielder maintains “an efficient supply” of flour and related products for its New Zealand business.
“This transaction is another example of the successful execution of our strategy to divest non-core businesses to enable us to focus our capital and marketing expenditure and our internal resources on our core categories and brands,” said Goodman Fielder CEO Chris Delaney.
The transaction is expected to be complete in February.
Goodman Fielder has made losses in its last two financial years and is looking to cut costs. This is the second disposal Goodman Fielder has made this year. In August, the company offloaded its Integro commercial oils business to local grain trader GrainCorp.
In September, Goodman Fielder outlined plans for further reductions in its manufacturing network as part of its efforts to try to revitalise its business and reduce its plant number to 35 from 53.
Goodman Fielder’s restructuring plan, which it hopes will re-shape the business and allow it to “reallocate focus and resources”, aims to save A$100m (US$101.7m).
