Page 5 - Food & Drink Business August 2018

NEWS
Bega Cheese snares Koroit
BEGA Cheese has announced plans to acquire the Koroit facility formerly owned by Murray Goulburn from Saputo Dairy Australia.
The facility, located in Western Victoria, was formerly owned by Murray Goulburn prior to its acquisition by Saputo.
Saputo pledged to divest the facility to allay regulatory concerns over competition for raw milk in south-west Victoria and south-east South Australia.
Bega Cheese is paying $250 million for the facility, which processes around 300ML of milk into bulk and retail butter, commodity and retail milk powders and growing up milk powder.
Bega Cheese said it expects the Koroit facility to generate an annualised EBITDA of $20m, assuming the current annual intake of 300ML.
The transaction includes a Transition Services Agreement and a Milk Supply Guarantee Agreement which requires Saputo to guarantee supply of 300ML of milk per annum until 30 June 2020.
The Koroit facility will be integrated into Bega Cheese’s broader network of milk processing facilities, and the company also said there is potential upside from increased milk intake including milk Bega already collects in the region.
Bega Cheese noted, however, that it may take until FY2021 to fully integrate the facility.
“The Koroit Facility will provide us with a significant presence in Western Victoria and operational flexibility with our other milk processing sites,” Bega Cheese CEO Paul van Heerwaarden said.
“Importantly, the acquisition will support the continued growth of our core dairy business and provide domestic and export customers with an expanded range of products.” ✷
No Sugar replaces Coke Zero
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BEGA TO BUY MURRAY GOULBURN’S KOROIT Bega Cheese announced plans to acquire the Koroit facility formerly owned by Murray Goulburn from Saputo Dairy Australia.
✷ SEE OPPOSITE FOR STORY.
MEAL COMPANY LOOKS TO WOOL Insulated packaging made from wool by company Woolcool is giving ready meals company My Muscle Chef a profit boost.
BREWER TACKLES WASTEWATER
Sydney brewer 4 Pines embarked on a high-growth phase following its acquisition in September by global alcohol giant AB InBev. The capital injection has enabled 4 Pines to expand its operations.
SUSTAINABILITY WHIP TO CRACK
The Australian Packaging Covenant Organisation (APCO) is shining a torch on Australian businesses that are failing to meet their sustainable packaging obligations.
✷ SEE P7 FOR FULL STORY.
KAUFLAND HIRES LOCAL TALENT
The arrival of Kaufland in Australia is now imminent, with the German giant beginning its recruitment process. According to the Kaufland website, the retailer is currently seeking senior Melbourne-based executives in procurement, IT, building services, project management, and category management.
✷ SEE P7 FOR FULL STORY.
LOW-GI SUGAR TO REACH SHELVES
Full production of a new low-GI sugar is underway with the first product now hitting retail selves. The first line of the new retail product, Nucane, was produced last month, according to its maker Sunshine Sugar.
COCA-COLA will replace its Coke Zero product with the newer Coca-Cola No Sugar in September to boost consumer recognition of its sugar-free offerings.
The company introduced Coca-Cola No Sugar just over a year ago after it found that about half of consumers did not know Zero was sugar-free.
“We said we would let people decide and we are pleased to say the results are in – Australians have decided that Coke No Sugar is it,” Coca-Cola Australia’s marketing director Lucie Austin said in a statement.
“Australians have embraced Coke No Sugar – which from day one was carefully
crafted to taste
even more like
Coca-Cola Classic. It is no surprise that people are preferring it over Coke Zero.”
Coke Zero, introduced to Australia in 2006, will be entirely phased out by September, the company said.
Austin said 3.5 million Australians had drunk Coke No Sugar since its launch and the product was helping grow the low- and no-sugar category.
No Sugar was the result of five years of development and 15 consumer trials to get the taste of a non-sugar drink as close as possible to full-strength Coke.
Coca-Cola has reformulated 22 drinks in the
Australian market since 2015 to contain less sugar, and has been shifting its portfolio to include more no- and low-sugar drinks, such as bottled waters and coffee, as consumers shift away from sugary drinks.
Attempts by Coca-Cola and its local bottler Coca-Cola Amatil to grow their sales of low-sugar and sugar-free products come amid rising public concern about sugar consumption and its link to obesity, and growing calls for Australia to follow other countries in introducing a sugar tax.
The country’s biggest soft drink makers, including Coca-Cola and Pepsi, last month vowed to cut the amount of sugar in the drinks they sell by 20 per cent over the next seven years.
The target is for a percentage reduction in sugar relative to the amount of drink sold, rather than a volume reduction, so sales of sugar-free products will work towards their goal. ✷
www.foodanddrinkbusiness.com.au | August 2018 | Food&Drink business | 5