Danone Seeks Compensation From Fonterra Over Botulism
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Danone, the world’s biggest yogurt maker, canceled its supply contract with New Zealand’s Fonterra Cooperative Group Ltd. and said it’s seeking compensation for last year’s product recall over a contamination scare.
Danone said it sued in the New Zealand High Court in Auckland and is seeking arbitration in Singapore after an estimated loss of 300 million euros ($407 million) of free cashflow as a result of the recall, triggered when Fonterra warned some milk powders may have contained botulism-causing bacteria. Danone said it’s making any further contracts with Fonterra contingent on “full transparency” and respect of safety procedures the company requires of suppliers.