Kiwi dairy giant Fonterra is set to net NZ$88 million (€52 million) through the sale of two joint venture (JV) farm in China.

The New Zealand based dairy cooperative announced that a sale has been agreed, with the sale expected to be completed on Wednesday (June 30).

The farms in Shandong province will be sold to Singapore-based AustAsia Investment Holdings for a total of US$115.5 million (€96.74 million).

Fonterra, which owns the farms with a joint venture partner, has a 51% stake in the business and will receive NZ$88 million in total asset sale proceeds, which includes cash on completion.

The sale of the JV farms is unconditional and requires no further regulatory approvals.

Commenting, Fonterra CEO Miles Hurrell said the sale is “another important milestone for the cooperative and aligns to its strategy of prioritising New Zealand milk”, adding:

“The sale of the JV farms allows us to focus even more on our farmer owners’ milk and follows the sale of our two wholly owned China farming hubs earlier this year.

“Greater China continues to be one of our most important strategic markets.

“We remain committed to our China business, bringing the goodness of New Zealand milk to Chinese customers in innovative ways and partnering with local Chinese companies to do so.

“We are well placed to continue to grow our business in Greater China,” Hurrell added.

Fonterra sold its two wholly owned China farming hubs in Shanxi and Hebei provinces to Inner Mongolia Youran Dairy in April for NZ$552 million.