Bonlac Foods is to sell a plant manufacturing flavoured UHT milk to National Foods.
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The factory is based in the southern state of Victoria and has a production capacity of 25 million litres. It will further enhance Melbourne-based Natfoods’s dominance of the flavoured milk market, in which it already enjoys a share of almost 50%, reported Reuters. All 50 staff based at the factory will be offered employment by Natfoods.
Using UHT (ultra heat treated) flavoured milk allows for greater flexibility in distribution, as it does not need refrigeration. The company is hoping to start selling flavoured milk through vending machines and takeaway food shops. National Foods chief executive Peter Margin said the deal would be consistent with the company’s push into higher value added dairy products, delivering significant benefits.
Meanwhile, Bonlac said that the sale was part of its strategy of focusing on its core operations of making butter, cheese, powdered milk and other dairy products.
The two Australian companies declined to comment on the financial details of the deal, which is still subject to due diligence.
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By GlobalData
