Fonterra cuts value of Sanlu stake
24 September 2008
New Zealand's Fonterra Cooperative Group, the world's largest dairy exporter, cut the value of its stake in beleaguered Sanlu Group Co by 69%, Bloomberg reported. Fonterra wrote off US$95 million from its 43% stake in Hebei-based Sanlu, which is at the center of the nationwide dairy scandal in China. Sanlu received complaints about its milk powder as early as December and was aware that its products were contaminated with the chemical melamine in June, according to Chinese government investigations. Fonterra last week said Sanlu's board was not informed of the contamination until August 2. Fonterra is in discussions with the government on the future of Sanlu, according to Fonterra's chief executive Andrew Ferrier.