The Australian subsidiary will be known as Keytone Dairy Corporation and will have an ASX code of KTD.
Keytone began production of milk powders in New Zealand in 2013 and now produces whole milk powder and skim milk powder under its own brands, along with powder products for a range of other customers.
The company will issue 75 million ordinary shares at 20 cents, raising $15 million in the process.
Keytone chairman Bernard Kavanagh said the funds would be used to further develop the company’s manufacturing base near Christchurch plus develop sales in other markets.
Mr Kavanagh, who was formerly general manager at Warrnambool Cheese and Butter, said Keytone had bought two blocks of land at Rolleston, near Christchurch, to build a factory for manufacturing formulated and dairy nutritional products to complement the existing whole milk powder and skim milk powder plant in Christchurch.
He said the company did not process milk, instead buying in raw materials from dairy processors.
Mr Kavanagh said the first plant would allow the company to increase dairy product manufacturing capacity from 1500 tonnes to 5000 tonnes.
“With the funds raised, our aim is to first increase production capacity then increase the product range,” he said.
“We plan to further increase the capacity beyond that but obviously the details of the second plant need to be worked through,” he said.
“We are a small company with limited production capacity.
By: PETER HEMPHILL
Source: The Weekly Times