Synlait explains its surprise move into cheese market

Diversification is behind the conditional purchase of a cheese factory by Canterbury milk processor Synlait. 

Synlait is to acquire selected Talbot Forest Cheese assets - including property, plant and equipment - at its new Temuka site.

Synlait chief executive Leon Clement told RadioLIVE's Rural Exchange that the move is about growing the 'Everyday Dairy' market in New Zealand and overseas.

"It gives us a really flexible cheese manufacturing factory and lots of options in terms of what we can produce and where we can sell it," he said.

"We will be able to manufacture a variety of cheese products that complement our existing product portfolio, and at the same time further diversifying our revenue streams," he said.

The investment is expected to be in the range of $30 to $40 million, which reflects incentives for various conditions to be met.

The proposed acquisition is structured in two parts and settlement is expected in August 2019, once aspects of the conditional agreement have been met. 

Subject to the conditions being met, Synlait will assume management and operational control of Talbot on August 1, 2019.

Listen to the full interview with Leon Clement above.

Rural Exchange with Hamish McKay, Sarah Perriam and Richard Loe, 5-7am Saturday and Sunday on RadioLIVE with Carter's Tyre Service. Click here for all the ways to watch and listen.