The New Zealand dairy is seeking to raise 300m Chinese yuan (US $42m) through the bond issue denominated in Chinese renminbi (Chinese yuan deliverable in Hong Kong).
“As our business with Chinese customers expands, it makes sense to seek a greater alignment between our Treasury borrowing and our business activities,” said Stephan Deschamps, general manager, treasury, at Fonterra.
Fonterra China president Philip Turner added that the company would expand its activities in China from seven cities to 15 over the next three years.
Turner also sees opportunities in the ingredients market. “We are also exploring opportunities to produce and sell a range of premium value-added dairy ingredients for key customers on the ground in China,” said Turner.