Australia’s Bega Group has struck a deal to buy the Betta Milk and Meander Valley Dairy brands from local dairy peer TasFoods.
The acquisition, for A$11m ($7.1m) plus inventory, also includes a royalty-free licence to use the Pyengana Dairy brand for milk and cream products in Australia.
The Bega Cheese owner said the deal is “consistent with our strategy to build our portfolio of branded products and improves Bega Group’s offering of great local brands for Tasmanians”.
Bega Group CEO Pete Findlay said: “We recognise the quality in the Betta Milk, Meander Valley Dairy and Pyengana milk brands and we are delighted to add these Tasmanian brands to our portfolio. Betta Milk is a fantastic regional brand that has been a household name in Tasmania for over 65 years and acquiring these brands supports our ambitions to become a great Australian food company.”
Announcing the sale of the assets to Bega Group on the Australian Securities Exchange (ASX), TasFoods CEO Scott Hadley said the deal is “an important strategic step towards simplifying TasFoods and strengthening the company’s balance sheet”.
He added: “This transaction allows us to sharpen our focus on delivering organic growth across Nichols Poultry and Pyengana Cheese while continuing to identify and evaluate strategic and financially-compelling opportunities in adjacent, high-growth food and beverage sectors.”
In June, TasFoods announced the sale of its Shima Wasabi spices unit to local fruit business Hillwood Berries.
TasFoods said keeping the unit, which it acquired in 2016, did not fit in with the “strategic roadmap” it implemented in 2020.
Last week, Bega Group revealed it had booked a hefty impairment charge related to “commodity assets” in a challenging Australian milk market.
It posted a loss after tax of A$229.9m in fiscal 2023, swinging from an A$24.2m profit a year earlier.
Bega Group said the loss was “significantly impacted by a non-cash after-tax asset impairment” of A$230m.
Meanwhile, TasFoods recorded revenue of A$38.2m in the first half of this year, up 11% year-on-year. It booked a net loss of A$3.8m, versus a loss of A$5.4m in the first half of the previous financial year.
