Dairy Crest announces that it has purchased the outstanding 50% share of Promovita Ingredients Limited (“Promovita”) held by Fayrefield Foods Limited (“Fayrefield”) for a cash consideration of £6m, funded from existing borrowing facilities.
Promovita was established in 2014 as a 50/50 joint venture between Dairy Crest and Fayrefield to develop and produce GOS, a prebiotic for use in infant formula.
Having invested in the manufacturing capability at Davidstow and successfully produced GOS samples, Dairy Crest believes that full ownership of Promovita is in its and shareholders’ best interests. It allows Dairy Crest sole control over the development of the GOS business and to fully benefit from the value that this business generates.
Mark Allen, Chief Executive of Dairy Crest, commented:
“This is a further important step in the evolution of our added-value ingredients business. We remain on track to begin commercial production of GOS in early 2016 and this acquisition gives us full control over the development of this exciting business.”