New Zealand dairy behemoth Fonterra has revealed the start of a joint venture in India with Britannia Industries, which is already well established in the country.
Both companies would hold a 49% stake in the new company, which will be known as Britannia New Zealand Foods Private Ltd when it comes into effect tomorrow [Thursday]. A strategic partner will hold the remaining 2%.
The company will be involved in sourcing, manufacturing and distributing milk and milk products in India.
Nusli Wadia, chairman of Britannia, revealed that it would have full access to Fonterra’s R&D strengths to work on further upgrades of product quality. This will also help the company reduce product costs.
Britannia said in a statement earlier today that it will transfer its existing dairy business to the new JV.
The announcement came swiftly after yesterday’s revelation of the deal with Swiss food giant Nestlé to market its products in the US$230bn Americas market. Fonterra expects that it will take at least 12 months before it can begin to reap the benefits of this deal.