Synlait wants to sell off some of its brands to focus on its value-added, advanced nutrition and foodservice businesses Photo: Unsplash / Eiliv-Sonas Aceron
The dairy company Synlait wants to sell-off its household dairy brands Dairyworks and Talbot Forest Cheese, as it looks to pay down debt.
The move is part of Synlait's strategy and capital structure refresh, which includes an asset review.
It comes after the company drastically cut its earnings guidance for the full year, to be between a loss of $5 million and a profit of $5m.
Synlait has tasked investment bankers Jarden to advise on the divestment, and if the brands are sold, the proceeds would be used to pay down debt, it said.
Divesting Dairyworks and Talbot Forest Cheese would allow the company to focus solely on its value-added, advanced nutrition and foodservice businesses, the firm said.
"Dairyworks is an excellent business. It delivers cheese products to various channels under a portfolio of well-known household brands," chief executive Grant Watson said.
But he said Dairyworks was "not core" to Synlait's growth strategy: "Synlait needs to focus on the business units where we have a clear right to win.
"Although the performance of Dairyworks has met expectations, the intended divestment of Dairyworks and Talbot Forest Cheese will enable us to help deliver against an increasingly focussed strategy," Watson said.