WATTLE Health Australia will borrow funds to take a majority share in dairy processing and packing business Blend and Pack Pty Ltd.
Wattle Health Australia has a 5 per cent stake in Blend and Pack, but today’s announcement of a conditional agreement will now take ownership to 51 per cent, with a further 29 per cent to be acquired in about two years time under a put and call option.
The extra 46 per cent ownership will cost Wattle Health Australia $46 million plus undistributed earnings.
Blend and Pack is a strategic investment by WHA as it has a recently renewed Certification and Accreditation of the People’s Republic of China (CNCA) licence crucial for exports of Chinese labelled product into China.
Last year, the company entered into a joint venture with Organic Dairy Farmers of Australia to build a spray dryer to solely process organic milk as a stage in its production of organic infant formula.
In November last year, WHA launched its Uganic brand of organic infant formula products.
WHA executive chairman Lazarus Karasavvidis said the proposed acquisition of Blend and Pack put his company in a “unique position to add value across every aspect from the farm gate, processing and production supply chain and distribution”.
“As an accredited manufacturer under China’s Certification and Accreditation Administration, Blend and Pack is crucial to WHA securing a critical distribution channel into a market where burgeoning middle class is driving demand for clean, green, Australian nutritional dairy products,” Mr Karasavvidis said.
As seen in The Weekly Times, 11th February 2019.