Australia-China trade specialist Jatenergy (ASX: JAT) has made a sizable splash in the infant formula market, today announcing the 70% acquisition of dairy product producer Australian Natural Milk Association (ANMA).
The acquisition will enable Jatenergy to expand its manufacturing capabilities, which until now had outsourced the manufacturing of its dairy products.
“We are delighted to welcome ANMA to JAT. This acquisition accelerates JAT’s strategic plan to insource manufacture of its fast-growing product range and decrease reliance on contract manufacturers,” said Managing Director Wilton Yao.
“Through this acquisition, we are excited to secure infant formula slots for exporting infant formula and other dairy products to China, and look forward to delivering enhanced returns to investors by lowering costs and manufacturing more rapidly to meet growing demand.”
The move continues a strong year of corporate activity for Jatenergy which is also expanding beyond the infant formula that has made ASX darling a2 Milk (ASX: A2M) popular amongst investors.
This includes the launch of their premium Neurio goat milk brand which targets the high-growth middle-aged segment in Asia.
ANMA currently operates a 5000m2 facility in West Melbourne specialising in handling infant formula milk powder and other dairy products and is one of only 15 milk powder manufacturers in Australia approved by China’s Certification and Accreditation Administration (CNCA).
The $14 million acquisition signals a significant growth point for Jatenergy which recently announced their maiden cash flow positive quarter, delivering earnings of $2.87 million, a major turnaround on their $732,000 operating loss the previous quarter.