CEO part of dairy brand swap

Peter McClure began the week as chief executive of New Zealand Dairy Foods but emerged from yesterday's dairy brand swap an employee of rival Fonterra.

After nine years at the helm of the smaller of the two companies, McClure will be one of 800 NZDF employees transferred to Fonterra along with its two biggest brands - Anchor Milk and Fresh'n Fruity - which, among others, the dairy giant has bought for $754 million.

In return NZDF, controlled by Graeme Hart, has bought $416 million of Fonterra's assets, including Meadow Fresh drinks and yoghurts and its Kiwi Meats businesses - gaining $338 million from the deal.

McClure, who does not yet know his new role at Fonterra, said the deal would "obviously intensify competition" between the two companies. He imagined NZDF had plans to develop the brands it was gaining.

Although it was acquiring businesses with a lower profit base, NZDF considered Meadow Fresh and Kiwi Meats to be well run operations and well positioned in the market.

Despite the size difference between the brands, variations in the company's revenue levels would not be significant, an industry source said.

NZDF recognised the logic of Fonterra's strategy in wanting to align its domestic brands with its international profile.

Once completed, the NZDF brand portfolio will include Meadow Fresh, Weightwatchers and Naturalea yoghurts; Meadow Fresh, Naturalea and Nature's Energy beverages; Tararua cultured dairy; Anchor Cheese (under licence), Chesdale, Ornelle, Puhoi and Bouton d'Or cheeses; and Kiwi, Huttons and Top Hat meats.