Lactalis intends to use the Parmalat brand in Brazil, as it does in other emerging markets, said Samuel Oliveira, a director at Indusval & Partners bank which represented Lactalis in the deal. The French group believes there is plenty of room to grow in Brazil, where use of dairy products is still relatively low, he said.
Dairy represented close to 10% of BRF’s net revenue of 30.5bn reais in 2013. Brazil’s total dairy market was worth 62bn reais in 2013, from 56.2bn reais the year before, according to market research company Euromonitor.
Brazil is one the largest milk producers in the world and any big dairy company needs to be present in the country, said Indusval’s Mr Oliveira. Lactalis last year bought Brazilian gourmet-cheese maker Balkis, which has units in the states of São Paulo and Minas Gerais.
The French company offered 250 million reais at the end of August to buy four units of Brazilian dairy LBR-Lácteos Brasil, which is currently in bankruptcy protection. The French company has also worked to win the right to use the Parmalat brand name in Brazil, according to Marcelo Ricupero, a lawyer with the law firm of Mattos Filho who is working for Lactalis on the LBR deal. Parmalat is controlled by Lactalis, but LBR had the license to use the brand name in Brazil.
Source: Parmalat/WSJ
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