Natural Dairy NZ Holdings, the Hong Kong company blocked from buying the Crafar farms last year, has started selling New Zealand-made dairy products in China after UBNZ Funds Management was granted approval to export.
Natural Dairy told the Hong Kong Stock Exchange that it sold 100,000 cans of colostrums formula at a profit through its Chinese subsidiary, Jiang Xi Guo Yuan (Natural Dairy), and has received 11.6 million packs of ultra-heat treated milk from UBNZ Funds Management.
The delivery is the first since it entered into an agreement with the company formerly fronted by bankrupt businesswoman May Wang last year.
Natural Dairy paid some $28 million up front, and expects to get another 6 million packets this month, with the remaining 13 million set to arrive on time.
Delivery was pushed out while UBNZ was registered by the New Zealand Food Safety Authority. Its New Zealand Dairy Processing unit has since been registered as an approved dairy exporter.
UBNZ bought a dairy processing facility in Tauranga last year as part of its failed bid to buy the Crafar family farms and create a new vertically-integrated dairy manufacturer and exporter.
Its affiliated, UBNZ Asset Holdings, agreed to buy the farms in a deal that was to transfer ownership to Natural Dairy, but was ultimately blocked by the Overseas Investment Office.
The two companies changed strategy to focus on processing milk for sale in China, and they reached an initial agreement for Natural Dairy to buy 150 million packs for some $105 million.
That's since increased to 450 million packs at 70 cents apiece, and the parties pushed out their agreement for a further three years, according to Natural Dairy's statement.
After failing to acquire local farms, UBNZ was forced to buy milk from Fonterra Cooperative Group under the Dairy Industry Restructuring (Raw Milk) Regulations.
Fonterra wasn't immediately available to comment on whether it was still supplying UBNZ with milk.
UBNZ is now a substantial shareholder in Natural Dairy, with a 17.18% stake, after converting bonds into equity last year.
Ownership of the UBNZ group of companies changed hands to NZ Dairy Trustee from UBNZ Trustee on December 23.
Dairy Trustee is owned by Malia-i-makalata Po'uhila, Linling Xie, and Murray Hunter in three equal share parcels, according to Companies Office documents.