NZ food safety firm quiet on rumours

AsureQuality is is staying mum on reports it's in talks to buy out its partners in Australia's Dairy Technical Services. Photo / iStock

AsureQuality, the state-owned food safety and biosecurity services firm, is staying mum on reports it's in talks to buy out its partners in Australia's Dairy Technical Services.

The Australian Financial Review's StreetTalk column, citing unnamed sources, reported Melbourne-based DTS is in talks with 25 per cent shareholder AsureQuality over a potential buyout, valuing the food and beverage testing business at between A$80 million and A$100 million.

DTS's other shareholders include Fonterra Co-operative Group, Murray Goulburn Co-operative and Warrnambool Cheese and Butter Factory.

A spokeswoman for AsureQuality said the state-owned enterprise was "bound by confidentiality" and has no comment to make.

In September, AsureQuality reported a 9 per cent decline in profit to $11.4 million for the year ended June 30, and said it expected a further decline next year as it ramps up investment for future expansion outside its core markets of Australia and New Zealand and into southeast Asia, China, and the Gulf states. It valued its DTS stake at $10.4 million as at June 30.

DTS, which trades as DTS Food Laboratories, operates the biggest food microbiology and chemistry labs in southeast Asia with a staff of about 400, according to its website.

The Australian company reported a profit of A$4.1 million ($4.48 million) on revenue of A$50.1 million in the 12 months ended April 30, up from earnings of A$3.6 million on sales of A$45.6 million a year earlier, according to financial statements lodged with the Australian Securities & Investments Commission in August.