Australian Maggie Beer Holdings has agreed to sell its dairy subsidiary, Paris Creek Farms, to local group Katoomba Global Foods for A$500,000 ($325,710).
In a stock exchange filing, Maggie Beer Holdings said the sale is in line with its “objective to dispose of non-core assets and simplify the operating structure”.
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The group added that the deal supports its “broader strategy to streamline its portfolio, reduce complexity, and enable targeted investment in high-growth, high-value areas of the business”.
Paris Creek Farms’ product portfolio includes milk, butter, cheese and flavoured yogurt.
In February, the company revealed several parties had expressed interest in acquiring Paris Creek Farms.
It had decided to divest this business as its earnings were “significantly impacted by the loss” at Paris Creek Farms in FY24.
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By GlobalDataThe divestment is expected to result in annualised cashflow savings of approximately A$2.2m for Maggie Beer Holdings.
Mark Lindh, chair of Maggie Beer Holdings, said the sale is “an important step in our strategy of simplification and accelerated profitability”.
The sale is expected to be completed by next week.
Katoomba Global Foods is a Victoria-based company which specialises in manufacturing and distribution
It supplies a variety of global brands, such as Al Wadi, Maggi, and Pangkarra.
Maggie Beer Holdings also owns two other business units: Maggie Beer Products and Hampers & Gifts Australia (HGA).
Hamish McLeay, general manager of the company’s Maggie Beer Products and Paris Creek Farms units, said the deal will allow the group to “sharpen our strategic focus on our core premium brands, particularly Maggie Beer Products”.
In February, the company eliminated the roles of joint interim group COO and CFO as part of an ongoing “strategic review” to boost profits.
The Adelaide-based company looked to “reduce the cost of doing business” and “improve margins”, as part of the review.
In the first half of its fiscal year 2025, ending 31 December 2024, the group reported total sales of A$54.4m, a 5.8% increase from the same period in 2024.
Announcing the results at the end of February, the company said that wile Maggie Beer Products and HGA had reported sales growth, Paris Creek Farms saw a 5% decline in net sales due to reduced intercompany sales, a key export going into administration, and the loss of a customer.
The group’s EBITDA fell 16.8% in the first-half to A$3m, while gross margins remained flat at 50.9%.
