Breads and spreads manufacturer Goodman Fielder has agreed to sell its New Zealand-based Champion flour milling business to Japan's largest manufacturer of wheat flour Nisshin Flour Milling and its parent Nisshin Seifun Group for NZ$51 million (AU$40.5 million).
Chris Delaney, Goodman Fielder CEO, said the transaction was consistent with the company’s strategy to optimise its portfolio by focusing on its core categories.
“This transaction is another example of the successful execution of our strategy to divest non-core businesses to enable us to focus our capital and marketing expenditure and our internal resources on our core categories and brands,” Delaney said.
“Together with the sale, we have also structured a long-term supply partnership with Nisshin to ensure Goodman Fielder maintains an efficient supply of flour and related products for our business in New Zealand.
“With global scale and expertise in milling, Nisshin brings considerable scope to provide further efficiency and innovation to create value under this long term supply agreement.”
Goodman Fielder will retain the business where it sells flour to retailers, in-store bakeries and hot bread shops, supported by the flour supply agreement with Nisshin.
Nisshin will be responsible for supplying to commercial and industrial customers in New Zealand.
The Japanese company has indicated its intention to retain all existing staff and will shortly offer new contracts.
The transaction is expected to be completed in February 2013, subject to the satisfaction of conditions.
Earlier in the year, Goodman Fielder sold its commercial oils business Integro to GrainCorp and Gardner Smith for $170 million.
