Fonterra's chief executive Miles Hurrell is being asked by Chile's prosecutor to hand over his computer files as part of an investigation into Fonterra's Chilean businesses.
The investigation was sparked by a complaint by a shareholder of Fonterra subsidiary Prolesur against Fonterra's appointed directors on the Prolesur board.
The directorsinclude Fonterra employees Robert Spurway and Paul Campbell. Hurrell was chairman of Prolesur last year.
He is not named in the complaint, which relates to a commercial disagreement between Fonterra-appointed directors and minority Prolesur shareholder the Isabel Aninat charity foundation.
But Fonterra said Hurrell's files are among those sought by the prosecutor's office.
It said the complaint related to a commercial disagreement between the Fonterra-appointed directors and minority foundation directors on the Prolesur board, concerning terms of sale for cheese between Prolesur and Fonterra's other Chilean subsidiary Soprole.
New Prolesur chairman Gerardo Varela, a former Chile education minister, is named in the complaint.
Chilean media reports claim seven Soprole executives have refused to turn over their computers to the investigation.
Prosecutors are investigating Fonterra's business in Chile. Photo/Getty Images.
Fonterra said Soprole employees were cooperating with the prosecutor, including having discussions to identify which information and records were relevant to the complaint.
"No charges have yet been brought against the Fonterra-appointed directors," said Fonterra in response to Herald inquiries.
"We fully support our appointed directors. If any charges are brought by the Chilean prosecutor after investigating the claims, the directors will vigorously defend them," the company said in a statement.
Hurrell was appointed the chairman of Prolesur, Fonterra's Chilean ingredients business, in 2017, before he took the top job at Fonterra.
Chilean media reports also claim Fonterra could be considering selling its South American assets for $1 billion.
Fonterra, New Zealand's biggest company, is reviewing all its assets as it seeks to reduce debt by $800 million this year. Last year it posted a historic loss of $196m and debt of $6.2b.
No asset sale decisions have yet been announced by the firm.
Chile's commercial prosecution unit has been approached for comment.
Soprole, a consumer foods business, is Fonterra's oldest offshore investment. But New Zealand dairying's connection with the company goes back to 1986 before Fonterra was formed when the-then exporter Dairy Board acquired more than 50 per cent of the company.
Prolesur, based in southern Chile, is an ingredients business which supplies 30 per cent of Soprole's milk. Prolesur was established in 1990 when Soprole was restructured.
