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Lactalis buys Nestle Malaysia's chilled dairy assets

Lactalis, the world’s largest dairy firm, has agreed to buy Nestle’s chilled dairy business in Malaysia in a deal worth around $40mn.

Lactalis, the world’s largest dairy firm, has agreed to buy Nestle’s chilled dairy business in Malaysia in a deal worth around $40mn.

Through the purchase, Lactalis plans to establish Malaysia as the operational hub of its dairy business in Asia.

As part of the divestment, Nestle will invest MYR100mn ($24mn) to expand its Chembong Milo production facility.

Milo is a chocolate malt beverage brand owned by Nestle that is popular primarily in Oceania, South America and South-east Asia.

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The investment will allow to Nestle to “upgrade production facilities and improve operational efficiencies” according to the statement and will also establish the site as the biggest Milo manufacturing centre in the world.

Alois Hofbauer, CEO of Nestlé (Malaysia) Berhad said: “Nestlé remains positive on the Malaysian market and Malaysia as an export hub and we look forward to unlocking more growth opportunities in the future.

“We see great potential that these investments will allow us to strengthen our focus on strategic core businesses that can deliver good long-term growth and are aligned with evolving consumer needs.

“At the same time, this initiative will pave the way for the Chilled Dairy business and PJ factory to flourish under the new leadership of Lactalis.

Last year, Lactalis acquired the Stonyfield organic yoghurt band from Danone.

The company also recently purchased siggi’s, a US-based maker of Icelandic yoghurt.