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Archer Capital looking for Asian investor in Brownes Dairy business

DBR Staff Writer Published 22 September 2014

Private equity firm Archer Capital is looking for an Asian investor to infuse capital and expand its Brownes Dairy business in Australia.


The potential partner is likely to acquire stake worth as much as $224m, the Wall Street Journal reported.

Archer plans to utilise the capital to distribute Brownes Dairy products in Asia, especially mainland China, where demand for milk and related products is growing among the middle classes.

Brownes currently processes 144 million liters of milk from 61 dairy farms annually. It produces white milk, yogurt and flavored drinks which are distributed across the Western Australian market.

The proposed partnership with an Asian investor will allow Brownes to record increased margins on milk sales.

As reported in the news source, Archer seeks to withstand price war in the sector with retailers. Supermarkets have been producing their own brands of dairy products and selling them for low prices for the past three years to attract customers.

Archer had acquired Brownes Dairy from New Zealand-based Fonterra Co-operative Group.

Fonterra and Chinese infant formula producer Beingmate Group have recently entered into an agreement, under which Fonterra will have access to Beingmate's distribution network.

Image: Brownes currently processes 144 million liters of milk from 61 dairy farms annually. Photo: courtesy of Naypong / FreeDigitalPhotos.net.