These names might not be as well known on the mainland, but Taswegians will know this sentence: Tasfoods (ASX:TFL) is acquiring Betta Milk for $11.5 million.

Tasfoods, a diversified Tasmanian food business known for selling Tassie-grown chicken, dairy and wasabi, is calling it a “transformational moment” for the company as its seeks to expand both its product offering and distribution footprint.

  • Scroll down for the ASX’s other food and agriculture movements today.

TFL shares got an 8 per cent boost, up to 13.5c in early trade today.

Betta Milk is a Tasmanian-based unlisted public company in operation for more than 60 years, with net revenue of $16.4 million in the 2018 financial year. It processes about 10 million litres of milk a year, and has market shares of 17 per cent of Tasmanian fresh milk sales and 37 per cent of branded milk sales.

Betta Milk fans need not worry about the brand name disappearing, with Tasfoods telling the market this morning it would “continue to support the Betta Milk brand in the Tasmanian market where it has a strong and loyal following”.

Tasfoods CEO Jane Bennett told Stockhead this morning about the excitement within.

“The benefit this acquisition gives us is scale,” she said.

“There are a whole lot of synergies, it will enable us to increase capacity and expand shelf life and look to opportunities both domestically and overseas.”

However for those wondering, Tasfoods will not be getting into the dairy formula market. Exports would be of bottled milk
– and there is talk of “opportunities in … Asian markets” – with extended shelf lives.

The acquisition is being funded by a range of internal and external sources, with a fully-underwritten $8 million non-renounceable rights issue to start imminently.

Shane Noble, Tasfoods chairman, said it would “help us achieve our goal to become a more significant player in the Australian dairy market” and that the company was “on track” to report positive earnings before interest, tax, depreciation and amortisation by the end of the calendar year.

In other ASX food and agriculture news today

Fonterra (ASX:FSF) sells Tip Top for $380 million. New Zealand’s most iconic ice cream brand, Tip Top, has a new owner, after England-based Froneri bought it out. Fonterra and Froneri went to great lengths in the announcement to assure Kiwis that the brand would remain in New Zealand.