December 20, 2017 / 12:52 AM / a month ago

UPDATE 1-New Zealand's Synlait Milk to supply Foodstuffs South Island

(Adds details of investment, CEO quote, share performance)

Dec 20 (Reuters) - Synlait Milk said on Wednesday it had partnered with wholesaler and retailer Foodstuffs South Island Ltd to exclusively supply its private-label fresh milk and cream from early 2019, as the company looks to expands its current portfolio of products.

The dairy producer said it intended to invest about NZ$125 million ($87 million) in a liquid dairy packaging facility to supply Foodstuffs South Island.

The facility’s minimum annual capacity would be 110 million litres, producing pasteurised milk and cream for domestic use and long-life milk and cream for export, among other products.

“We believe this opens up a new category - everyday dairy - and has the potential to both leverage our current position and explore new customers and markets,” said John Penno, Synlait’s managing director and chief executive.

Shares in Synlait were 4.6 percent higher at NZ$6.99 at 0043 GMT, while the benchmark index had gained 0.2 percent. In the year to Tuesday’s close, the stock had gained 114.8 percent.

$1 = 1.4345 New Zealand dollars Reporting by Aaron Saldanha in Bengaluru; Editing by Stephen Coates

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