Arla Foods to sell 8% stake in Vigor to Lala

Arla Foods is all set to sell its 8% stake in Brazilian dairy company Vigor to Mexico’s Grupo Lala for an undisclosed sum.

This interest will take Lala’s stake in Vigor to 99.99% after the company agreed a $1.84bn deal with J&F Investimentos for 91.99% stake in August.

J&F holds 80.8% of Vigor and is the controlling shareholder of meatpacker JBS.

JBS holds a 19.2% stake in Vigor.

In 1986, Arla signed a 50/50 joint venture partnership with Vigor under the name Dan Vigor, which comprised local cheese production under the Danubio brand.

The company exchanged the joint ownership of Dan Vigor in 2014 to acquire a stake of 8% in Vigor.

Arla Foods executive vice-president Tim Ørting Jørgensen said: “Arla has operated in the Brazilian market for decades, however, a co-ownership of Vigor no longer serves our strategic purpose.

“Our decision to divest is the best solution for Arla as we continue to focus our strategic investments on creating sustainable growth through our business in Asia, Africa, the Middle East, and USA.”

International dairy company Arla Foods is owned by farmers from Denmark, Sweden, the UK, Germany, Belgium, Luxemburg, and the Netherlands. It also manufactures organic dairy products.

Brands such as Arla, Lurpak and Castello belong to the Arla family.