New Zealand’s dairy processing company Synlait has received the approval of the Overseas Investment Office (OIO) for acquiring a stake in Dairyworks.

In October, Synlait announced a conditional acquisition of the South Canterbury-based company for NZD112m ($71m).

Synlait CEO Leon Clement said: “This acquisition accelerates the execution of Synlait’s Everyday Dairy strategy. It provides us with instant scale in the sector, new growth opportunities and a diversified earnings base for our shareholders.

“Dairyworks gives Synlait the opportunity to extract more value from our milk pool and we see strong synergies with our recent Talbot Forest acquisition. We’ll now be closer to the consumer and own more of the value chain.”

This acquisition forms part of Synlait’s Everyday Dairy strategy.

Obtaining consent from the Overseas Investment Office was the only condition attached to Synlait’s purchase of the shares.

The company can now close the deal on 1 April 2020.

Dairyworks will operate as an independent business entity under the Synlait umbrella, with Tim Carter serving as its CEO. Carter will report to Clement.

Established in 2001, Dairyworks produces cheese, butter, milk powder and ice-cream products at its manufacturing facility in Christchurch, New Zealand.

It offers its cheese and butter products under various consumer brands, including Rolling Meadow and Alpine, which it distributes to supermarkets in New Zealand and Australia.

Dairyworks CEO Tim Carter said: “Dairyworks and Synlait are a logical fit. We’re like-minded companies with a shared passion for doing things differently in the dairy sector. This is an exciting opportunity for us to work with Synlait to keep growing Dairyworks. It’s a great fit.”