GLASGOW, Scotland, September 5, 2011 /PRNewswire/ --

Fonterra and First Milk announce strategic joint venture to focus on innovative whey protein products to meet growing European demand

New Zealand-based Fonterra and UK-based First Milk today announced a strategic joint venture to produce premium whey¹ proteins for Fonterra's growing food ingredients business. The two dairy farmer co-operatives will combine their intellectual property and industry expertise to add value to the whey streams at First Milk's Lake District creamery in Cumbria, England.

For Fonterra this joint venture is the first step in realizing its goal of local European sourcing to meet the nutrition ingredient demand of European customers. For First Milk this deal adds value to the whey stream of the cheese making process, which will enhance the returns it can pass back to its farmer members.

Koert Liekelema, Fonterra Europe's managing Director, said: "We are delighted to announce this joint venture.  First Milk shares the co-operative heritage and spirit with us and we look forward to using our consumer insights and innovative mind-set to produce products which help European consumers live healthier lives."

Mr. Liekelema added: "This deal underpins Fonterra's strategic focus on premium ingredients, in particular milk and whey proteins. Furthermore, we are very pleased to secure First Milk's whey protein, enabling Fonterra to offer custom made, premium whey protein ingredients to the major food companies in Europe."

Kate Allum, chief executive of First Milk commented: "While this is our first step into added value whey markets, it builds on the work we have done recently with a range of partners across the supply chain to deliver pioneering solutions.

"Obviously the UK market remains the bedrock of our business. However, it is also important that we explore opportunities, such as this one with Fonterra, that have the potential to deliver enhanced returns for our dairy farmers.  

"With its leadership in dairy innovation and technical expertise, Fonterra are a great partner for First Milk and we look forward to working with them on this joint venture."

The premium whey proteins from First Milk Lake District creamery will be applied in Fonterra's functional and cultured nutrition ingredients like PowerProtein™ and ElevateProtein™, based on Whey Protein 80% ingredients (WPC80).

¹ Whey is a milk serum, separated as liquid from the curd in the cheese making process

About Fonterra

Fonterra is a global leader in dairy nutrition - the preferred supplier of dairy ingredients to many of the world's leading food companies. Fonterra is also a market leader with its own consumer dairy brands in Australia/New Zealand, Asia/Africa, Middle East and Latin America.

The farmer-owned New Zealand co-operative is the largest processor of milk in the world, producing more than two million tonnes of dairy ingredients, value added dairy ingredients, specialty ingredients and consumer products every year.

Drawing on generations of dairy expertise, Fonterra is one of the largest investors in dairy based research and innovation in the world. Its 16,000 staff work across the dairy spectrum from advising farmers on sustainable farming and milk production, to ensuring exacting quality standards and delivering every day on Fonterra's customer promise in more than 100 markets around the world.

About First Milk

First Milk is a farmer-owned food business that supplies and markets 15% of the milk produced in the UK. As an integrated company, it is a major player in the liquid milk, dairy ingredients and cheese sectors.

As a business with a passion for innovation and sustainability, it is constantly seeking fresh ways of working with partners across the supply chain to drive pioneering solutions to industry challenges. This has been supported by rapid progress recently on launching new products, and securing new customers in UK and international markets.

SOURCE First Milk