Parmalat Buys Lactalis American Group for $904 Million

MILANItalian dairy giant Parmalat S.p.A. has been given the go-ahead to acquire its sister unit Lactalis American Group, Inc., for $904 million. Both groups are owned by French dairy giant Lactalis, and the partially internal transaction is expected to be complete by the end of July 2012.

Lactalis American Group operates mainly in the United States in the production and distribution of cheese and other dairy products. The companys folio of proprietary and licensed brands includes international brands, such as Galbani" and Président," and local brands, such as Sorrento," Precious" and Mozzarella Fresca." The acquisition includes the distribution, on an exclusive basis, of the products of the Lactalis Group throughout the Americas.

The transaction will help Parmalat Group to strengthen its entry into the U.S. dairy market; increase revenues provided by value-added products, such as soft and fresh" cheese that currently virtually absent from Parmalats portfolio; exploit opportunities deriving from the export from Canada to the United States of cheddar cheese Black Diamond" brand with relevant important synergies in costs and revenues; and maintain a stronger competitive position in Latin America with the addition of access in high growth markets, such as Brazil and Mexico with cheese products manufactured in Canada, the United States and Europe.