Blog: Dean BestLactalis's emerging markets push continues

Dean Best | 29 March 2016

The French giant - the world's number two dairy group by sales - has struck another deal in a promising emerging market for dairy.

Lactalis has agreed a deal to buy the dairy business of Indian conglomerate Anik Industries. The transaction is the second Lactalis has made in India. In 2014, Lactalis snapped up local processor Tirumala Milk Products.

India is held up as potentially one of the world's key growth markets for the dairy sector. Demand for packaged products in India is rising rapidly and the country is home to domestic players building businesses across the country, including the likes of Amul.

However, competition is just one of the challenges facing international dairy companies investing in India investors, with the country's supply chain infrastructure presenting specific problems.

Nevertheless, Lactalis appears confident enough in India's potential to invest again in the country, snapping up a business with two plants. The privately-owned business had not returned a request for comment at the time of writing.

The move for Anik Industries' assets is the third in emerging markets Lactalis has made in 2016 alone.

Last month, Lactalis became a shareholder in Sante, a dairy company in the former Soviet republic of Georgia.

In January, Lactalis moved to buy a majority stake in Albalact, the Romanian dairy group.

And Lactalis struck two notable deals in each of the last two years. Last May, Lactalis snapped up 80% of Turkey's Ak Gida. In February, through majority-owned Italian dairy group Parmalat, Lactalis acquired a clutch of dairy assets in Mexico.

That deal came just five months after Parmalat bought 11 dairy plants from Brazilian meat giant BRF. The transaction with BRF followed another acquisition in Brazil, when Parmalat acquired Lacteos Brasil.

Lactalis is not alone in its ambitions to build a significant presence in a number of the world's faster-growing dairy markets.

But the family-owned business is quietly carving out positions in some potentially sizeable markets.

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