Australian dairy company Bega Cheese has reached an agreement to acquire all of the shares in Lion Dairy & Drinks (LD&D) from Japanese beverage giant Kirin Holdings for a consideration of A$560m ($412m).

The deal, announced earlier this week, will cover manufacturing, marketing, sales and distribution of LD&D’s portfolio of milk-based beverages, white milk, chilled juices and yoghurt.

LD&D also entered into a licensing agreement with Sodima to manufacture and sell yoghurt and dairy desserts under the Yoplait brand in Australia as well as in certain South-East Asian markets.

Bega Cheese executive chairman Barry Irvin said: “We are delighted to announce this acquisition which we believe will create significant value for shareholders.

“The acquisition delivers important industry consolidation and value creation with synergies across the entire supply chain. The expanded product range, manufacturing and distribution infrastructure and brand portfolio realises our ambition of creating a truly great Australian food company.”

Additionally, the deal will also enable Bega Cheese to take ownership of LD&D’s international businesses as well as the stake owned LD&D in the joint ventures (JV), established with Vitasoy Australia Products and Capitol Chilled Foods Australia.

LD&D also operates Australia’s largest cold chain distribution network, which supplies products to foodservice and convenience stores in the country.

Currently, LD&D has 13 manufacturing sites in the country.

Completion of the deal should take place by the end of January 2021.

The deal could enhance Bega Cheese’s offering portfolio and also significantly expand its domestic distribution footprint through LD&D’s national cold chain distribution network.

Additionally, the acquisition will increase Bega Cheese’s annual milk intake to 1.7billion litres from 955 million litres.

Bega Cheese CEO Paul van Heerwaarden said: “We are very pleased with the performance of acquisitions made in recent years which are achieving or exceeding our profit targets.

“The recent company restructure and ERP implementation will allow us to integrate this Acquisition and take advantage of the various synergies and growth opportunities across domestic and international markets.”