Dairy Holdings' major shareholder and co-founders of the company more than 20 years ago, Colin and Dale Armer, took the opportunity to lift their stake to nudge 42 per cent, while the other large shareholder Murray and Margaret Turley increased their holding to 33 per cent.
PSP, which has other agribusiness interests in New Zealand, did not have to seek Overseas Investment Office approval for the purchase because it was under 25 per cent.
Dairy Holdings annual revenue is estimated to be around $96 million. It produces around 16 million kilograms of milksolids a year and has assets of more than $1 billion, milking 55,000 cows over 75 dairy and grazing farms.
Dairy Holdings is Fonterra's biggest shareholder.
Gent, like Colin Armer, a former Fonterra director, said PSP, with its long term view of agribusiness, was a good fit for a company with two intergenerational families as major shareholders.
"They're big enough to see through commodity cycles ... and taking a shareholding is a vote of confidence in Dairy Holdings and the New Zealand dairy industry."
Armer said PSP was welcomed as a solid, long-term shareholder which shared the company's vision and strategy, which is based on farming using the natural resource of grass.
PSP has a seat on the Dairy Holdings' board and had proven itself a good corporate citizen, Armer said.
The pension fund was introduced to the company via "mutual acquaintances", he said.
PSP's other New Zealand interests include forestry heavyweight Kaingaroa Timberlands and Global Herd Ltd.
John Luxton of sold-up shareholder Jagewi Ltd told the Herald he had interests in Dairy Holdings for many years and the time had come for Jagewi shareholders "to move on".
The Waikato dairy farms owner and former National Party Cabinet minister said the sale "allowed each of us an opportunity to consolidate our separate business interests".
"We were pleased with it."
PSP has been approached to discuss the investment.
