Fonterra has agreed to purchase $526 million worth of assets from New Zealand Dairy Foods, and to transfer to it the Anchor and Fresh 'n' Fruity brands in New Zealand. In exchange, NZDF will acquire $291 million of Fonterra’s businesses, gaining the dairy giant's Meadow Fresh drinks and yogurt arm and its Kiwi Meats division.

Fonterra currently owns the Anchor butter brand outside New Zealand, but the iconic brand’s ownership in its domestic market was handed to NZDF by the government as part of the deal that saw the formation of Fonterra in 2001.

Much has been made of the move to reunite the Anchor butter label under one roof, but this is likely to have minimal effect outside New Zealand.

Although Fonterra was forced to sell its stake in NZDF in 2001 and lost out on the opportunity to buy National Foods this year, these setbacks have done little to thwart the company's progress. Fonterra now produces, markets and distributes products in 140 countries, and it generated revenues of about $7.7 billion in fiscal 2004.