Synlait Milk has agreed to sell its North Island sites for $307 million to US-based Abbott Laboratories.
This comes as part of a business restructuring to concentrate on its main operations in Canterbury.
“We are delighted to announce the entry into this agreement to sell our North Island assets to our valued customer and global healthcare leader – Abbott,” Synlait chair George Adams said.
“The sale will strengthen the company’s financial position, with the proceeds used to significantly reduce debt. We are equally pleased Abbott will onboard the vast majority of our people who work in these assets at completion – that is a great outcome.”
The company revealed the sale agreement as it released its financial results, reporting a loss after tax of $39.8 million, which was “adjusted” to a net profit of $0.8 million, down from a loss of $182.1 million the previous year.
Abbott has been a Synlait customer since 2020.
The sale of North Island assets includes the Pōkeno manufacturing facility and the Auckland sites (the blending and canning facility on Richard Pearse Drive and the warehouse on Jerry Green Street), as well as related inventory and leasehold agreements.
The sale is also subject to several conditions, including Abbott securing approval under the Overseas Investment Act 2005 and Synlait obtaining shareholder consent, along with other regulatory and customary approvals.
Synlait chief executive Richard Wyeth also commented on the announcement and described the North Island sale as “a much-needed step change for Synlait.”
“In short, this sale will deliver a stronger, simpler, and more secure Synlait,” he said.
“It enables us to, in time, explore opportunities to diversify what we do and better enable Synlait to reach its full potential.”