New Zealand dairy giant Fonterra has announced that it has agreed to acquire Kapiti Fine Foods from Foodstuffs Wellington.

The agreement is subject to approval from the New Zealand Commerce Commission (NZCC) and completion of the formal due diligence process.

“The acquisition of Kapiti Fine Foods will further support Fonterra Brands’ ‘Winning through Brands’ strategy which focuses on strong brands that deliver faster growth and better margins,” said Fonterra Brands’ managing director Sanjay Khosla.

“Under the proposed agreement Fonterra Brands will acquire a range of assets including production sites at Palmerston North and Paraparaumu. Fonterra Brands will also acquire the rights to supply the Pam’s milk and cream brand in the lower-North Island. The Kapiti branded cheese and ice cream will provide a strong high-value brand in specialty segments,” Khosla said.