The a2 Milk Company (ASX:A2M)
has received the tick of approval from the New Zealand Overseas Investment Office to acquire a 75 per cent interest in Mataura Valley Milk (MVM). MVM is a dairy nutrition business located in Southland, New Zealand.
A2 Milk, based in Auckland New Zealand, is a premium branded dairy nutritional company focusing on products containing the a2 beta-caesin protein type.
A key feature of the proposed investment is that MVM’s current majority shareholder, China Animal Husbandry Group (CAHG), will retain a 25 per cent interest in MVM alongside a2 Milk. CAHG is a wholly owned subsidiary of China National Agriculture Development Group, which is also the parent company of a2 Milk's strategic logistics and distribution partner in China, CSFA Holdings Shanghai (China State Farm).
The proposed acquisition will provide a2 Milk the opportunity to participate in nutritional products manufacturing, provide supplier and geographic diversification, and strengthen its relationship with key partners in China.
The completion of the transaction is set to occur with effect from the end of July 2021, and a further update on the acquisition will be provided at the time of the announcement of a2 Milk's full year results in August.
Shares in a2 Milk Company (ASX:A2M)
closed at $6.52 on Friday.