Dairy Crest takes full ownership of Promovita joint venture

Dairy Crest took full ownership of its galacto-oligosaccharide business on Monday.

The FTSE 250 dairy company confirmed it had taken the remaining 50% share in Promovita Ingredients, which was held by Fayrefield Foods, for a cash consideration of £6m.

Dairy Crest said it was funded from existing borrowing facilities.

Promovita was established in 2014 as a 50-50 joint venture between Dairy Crest and Fayrefield to develop and produce galacto-oligosaccharide, a prebiotic for use in infant formula.

"This is a further important step in the evolution of our added-value ingredients business," said Dairy Crest chief executive Mark Allen.

"We remain on track to begin commercial production of galacto-oligosaccharide in early 2016 and this acquisition gives us full control over the development of this exciting business."

In a statement, Dairy Crest said full ownership of Promovita would allow it sole control over the development of the business, and its shareholders would get the full benefit of its value.

Dairy Crest also expected to issue an interim management statement for the nine months ended 31 December 2015 on 11 February 2016.