Australian food giant Goodman Fielder will offload its New Zealand flour milling business to Japanese firm Nisshin as part of its wider strategy to recover from struggling finances.
Nisshin Flour Milling will pay NZ$51m for Champion Milling and the transaction should be completed in February 2013.
Chris Delaney, CEO of Goodman Fielder, said proceeds of the sale will be used for debt repayments and to further strengthen the company’s balance sheet.
“This transaction is another example of the successful executing of our strategy to divest non-core businesses to enable us to focus on capital and marketing expenditure and our internal resources on our core categories and brands,” Delaney said.
The CEO said that a long-term supply partnership with Nisshin had been agreed to maintain efficient flour supply to business in New Zealand.
Goodman Fielder will retain the business of selling flours to retailers, in-store bakeries and hot bread shops, supported by the flour supply agreement. Nisshin will take on responsibility of commercial and industrial customer sales in New Zealand.