Fonterra's acquisition of a chunk of a Chinese infant formula maker could prove risky for farmers.
The dairy giant has announced it's buying 18.8% in Beingmate Baby and Child for $750 million.
Waikato University agribusiness professor Jacqueline Rowarth says the Chinese company's had a 90% drop in profit and its CEO has recently left.
"One imagines that actually they were in trouble and want the money from Fonterra, and yes it is farmers money and they will be holding the risk."
Jacqueline Rowarth says the purchase has cost more than was expected.
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