Sanlu asset sales plan taking shape

A plan to sell the assets of the Chinese joint venture in which New Zealand farmers have invested about $200 million is taking shape.

The Beijing Review today reported moves to acquire several plants affiliated to Sanlu Group, the dairy products manufacturer at the centre of the chemically contaminated milk scandal .

Through its investment in Sanlu, Fonterra Cooperative Group effectively took a share of more than 40 affiliated plants that are interconnected. Fonterra holds 43 percent of the shares in Sanlu but has already written down $139 million worth of its investment's book value.

At least four babies died, and another 53,000 were made ill by adulterated Chinese milk powders containing melamine.

The Beijing Review said today that Sanlu expects to have to pay compensation claims totalling 700 million yuan ($NZ188 million) to consumers whose infants became sick or died after drinking its tainted baby formula.

Beijing-based Sanyuan Group is reportedly set to acquire Sanlu's seven key affiliate milk plants in Shijiazhuang, capital of Hebei Province.

The Wondersun Dairy Co Ltd, based in Heilongjiang Province in northeast China, is also expected to buy a plant in that province.

But details about the acquisitions and disposals of Sanlu's other factories around the country remain unclear.

This article is tagged with the following keywords. Find out more about My Tags

Comment & Question

Commenter icon key: Subscriber Verified

Post New comment or question

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.

NZ Market Snapshot

Forex

Sym Price Change
USD 0.7990 0.0030 0.38%
AUD 0.9056 -0.0015 -0.17%
EUR 0.6233 0.0009 0.14%
GBP 0.4937 0.0009 0.18%
HKD 6.1985 0.0227 0.37%
JPY 85.1130 0.0280 0.03%

Commods

Commodity Price Change Time
Gold Index 1244.2 5.700 2014-10-20T00:
Oil Brent 85.4 -0.760 2014-10-20T00:
Oil Nymex 82.8 -0.040 2014-10-20T00:
Silver Index 17.3 0.020 2014-10-20T00:

Indices

Symbol Open High Last %
NZX 50 5197.9 5238.9 5197.9 0.68%
NASDAQ 4254.2 4316.9 4258.4 1.35%
DAX 8819.3 8834.7 8850.3 -1.50%
DJI 16373.1 16401.6 16380.4 0.12%
FTSE 6310.3 6320.3 6310.3 -0.68%
HKSE 23073.4 23231.5 23070.3 -0.25%
NI225 15115.3 15115.3 15111.2 -1.25%