Friday, March 29, 2024

Tip Top goes for $380m

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Tip Top has been sold by Fonterra to global ice cream company Froneri, a Nestle subsidiary, for $380 million.
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Announcing the sale Fonterra chief executive Miles Hurrell talked up what he described as a fantastic brand in Tip Top with strong consumer connection but said Fonterra had to sell it because it couldn’t do it justice.

“Since we took ownership of Tip Top in 2001 a lot of work has gone into ensuring it remained New Zealand’s leading ice cream company,” chief executive Miles Hurrell said.

“Over that time we’ve had strong support from New Zealanders and I want to recognise and thank them for that.

“Tip Top has always listened to consumers and cared about their changing tastes as well as their long-time favourites. An average of 340 serves of Tip Top are enjoyed every minute of every day.

“This came through in both the number and quality of bids we received. 

“It’s a fantastic brand and as a result we’ve secured a good price for our farmers and unit holders.

“One of the big attractions for Froneri is the fact that Tip Top and Kapiti ice cream both use fresh milk and cream, from NZ grass-fed cows. 

“We’ve signed an agreement with the new owners to supply milk, which ensures that Fonterra farmers will continue to be part of the Tip Top story.

“We will also retain full global ownership of the Kapiti brand and will be licensing its use for ice cream to Froneri. 

“This means our popular Kapiti cheese isn’t going anywhere.

“I get the strong connection New Zealanders have with Tip Top. It will be important for them to see that it’s in good hands.

“It’s been a privilege being the guardians of Tip Top but it’s time to hand the baton to new owners. 

“The well-loved brand needs continuing investment and focused ownership to be sustainable for generations to come. It’s not something we’re in a position to do right now.”

Throughout its 80-year history Tip Top has been owned by several international brands and today’s announcement is the next chapter, Hurrell said.

“Froneri is the third largest ice cream manufacturer in the world, selling a staple of well-known ice cream brands in 20 countries. Froneri brings leadership and global expertise in ice cream, reach into new ice cream markets and new consumer products.

Froneri chief executive Ibrahim Najafi said the Tip Top name and its operations including the Auckland factory at Mount Wellington will be maintained.

“We have always admired Tip Top as NZ’s favourite and most trusted ice cream brand. The acquisition enhances our scale and supports our vision to build the world’s best ice cream company.”

The settlement date is May 31 but the transition will take months. Tip Top employees will transfer to Froneri.

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