Fonterra releases materials for Special Meeting in October

29 September 2025

Fonterra releases materials for Special Meeting in October

Fonterra Co-operative Group Ltd has released materials for the Special Meeting of Shareholders
to consider and vote on the sale of Mainland Group Holdings Limited.

The Special Meeting will be held virtually at 10:30am on 30 October 2025.

Attached is a copy of the Notice of Meeting, including the Explanatory Notes, which provides
Shareholders with the information required to enable them to vote, and a sample Voting / Proxy
Paper.

An email from Fonterra Board Chair Peter McBride to Fonterra farmers is also attached.

ENDS


For further information contact:
Anya Wicks
Director Governance, Risk and Audit
+64 9 374 9341

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Notice of Special Meeting of Shareholders and
Explanatory Notes in relation to the proposed
sale of Mainland Group Holdings Limited
The Special Meeting of Shareholders to consider and vote on the sale of
Mainland Group Holdings Limited will be held online at:
https://fonterra.brandlive.com/Fonterra-Special-Meeting/en
at 10.30am on Thursday, 30 October 2025
IMPORTANT:
This is an important document and requires your urgent attention. You are encouraged to vote and have your say on the
sale. You should read this Booklet in its entirety before deciding whether or not to vote in favour of the sale.
Fonterra Special Meeting 2025
Your Co-op,
Your Vote.
Your Directors unanimously recommend that
Shareholders vote in favour of the resolution to
approve the sale.

Fonterra - 2025 Special Meeting and Explanatory Notes1
Purposes of this Booklet
In addition to serving as a Notice of Meeting for a Special
Meeting of Shareholders, the purposes of this Booklet are to
provide you with:
a) information about the proposed sale of 100% of the shares
in MGHL to Lactalis (or a direct or indirect wholly-owned
subsidiary of Lactalis). MGHL is currently an indirect wholly-
owned subsidiary of Fonterra and is (or will be, following
an internal restructure) the holding company of a number
of subsidiaries comprising the “Mainland Group”. The
Mainland Group undertakes, or is to undertake, the business
as described in Part Two, Section A: Rationale for the
Transaction and Section B: Description of the Business of
Mainland Group of this Booklet;
b) the material terms and conditions of the proposed
Transaction and, if approved, how the Transaction will be
implemented;
c) information as to Fonterra’s on-going business, if the
Mainland Group is disposed of; and
d) other information that could reasonably be expected to be
material to your decision whether to vote in favour of, or
against, the Resolution to approve the Transaction.
This Booklet does not take into account your individual
investment objectives, financial situation or needs. You must
make your own decisions and seek your own advice in this
regard. The information and recommendations contained in
this Booklet do not constitute, and should not be taken as
constituting, financial advice, financial product advice, investment
advice, tax advice or legal advice. In particular, this Booklet does
not constitute a recommendation or offer to buy or sell securities
in Fonterra or the Fonterra Shareholders’ Fund. If you are in any
doubt as to what you should do, you should seek advice from
your financial, investment, taxation or legal advisers before
making any decision regarding the Transaction.
NZX
NZX does not accept any responsibility for any statement in this
Booklet. NZX is a licensed market operator, and the NZX Main
Board is a licensed market under the Financial Markets Conduct
Act 2013.
Forward looking statements
This Booklet contains certain forward-looking statements. You
should be aware that there are risks (both known and unknown),
uncertainties, assumptions and other important factors that
could cause the actual conduct, market conditions, results,
performance or achievements of Fonterra to be materially
different from the future conduct, market conditions, results,
performance or achievements expressed or implied by the
forward looking statements, or that could cause future conduct
to be materially different from historical conduct. Deviations as
to future conduct, market conditions, results, performance and
achievements are both normal and to be expected.
Forward looking statements generally may be identified by the
use of forward looking words such as ‘target’, ‘targeting’, ‘aim’,
‘anticipate’, ‘believe’, ‘estimate’, ‘expect’, ‘forecast’, ‘foresee’, ‘future’,
‘intend’, ‘likely’, ‘may’, ‘planned’, ‘potential’, ‘should’, or other similar
words.
Any estimates or projections as to events that may occur in the
future (including EBITDAF, revenue, profit, underlying profit,
dividends, margin, expenses, earnings, assets, liabilities and
performance) are based upon the best judgement of Fonterra
from the information available as of the date of this Booklet. A
number of factors could cause actual results or performance
to vary materially from the estimates or projections. No person
(including Fonterra and its Directors, officers, employees and
advisers) gives or makes any representation, warranty, assurance
or guarantee that the occurrence of the events expressed
or implied in any forward looking statements in this Booklet
will actually occur and except to the extent (if any) required
by applicable law or any applicable listing rules, assumes any
obligation to provide any additional information or update these
forward looking statements for events or circumstances that
occur subsequent to the date of this Booklet. No reliance should
be placed on any forward looking statements.
Non-NZ GAAP financial information
This Booklet includes certain financial measures that are
‘non-GAAP (generally accepted accounting practice) financial
information’ under Guidance Note 2017: ‘Disclosing non-GAAP
financial information’ published by the New Zealand Financial
Markets Authority. Non-GAAP measures can be useful for
investors and other users of this information as they can provide
additional insight into an entity’s financial performance, financial
condition and/or cash flow. Such financial information and
financial measures (including EBITDAF and normalised EBITDAF,
operating free cash flow, stay-in-business capex and net debt) do
not have standardised meanings prescribed under NZ IFRS and
therefore may not be comparable to similarly titled measures
presented by other entities, and should not be construed as an
alternative to other financial measures determined in accordance
with NZ IFRS.
The non-GAAP measures have not been subject to assurance
by an auditor or third party. No reliance should be placed on any
such non-NZ GAAP financial information included in this Booklet.
Important Information

Fonterra - 2025 Special Meeting and Explanatory Notes2
Pro forma financial information
This Booklet includes certain pro forma financial information.
The pro forma financial information is provided for illustrative
purposes only and is not represented as being indicative of
Fonterra’s future financial position and/or performance. An
independent assurance provider’s report on both the Fonterra
reported historical financial information and the historical pro
forma financial information for Fonterra and the Mainland Group
is provided in Appendix B.
No internet site forms part of this Booklet
Any references in this Booklet to any website are for
informational purposes only. No information contained on any
website forms part of this Booklet. To the maximum extent
permitted by law, Fonterra and its Directors, officers, employees
and advisers do not assume any responsibility for the contents of
any website referenced in this Booklet.
Responsibility for information
Other than as set out below, this Booklet has been prepared by,
and is the responsibility of, Fonterra:
• the Purchaser Information in Section E: Details of the
Purchaser of Part Two of this Booklet. Fonterra and its
Directors, officers, employees and advisers have not been
involved in preparing or verifying any of the Purchaser
Information and do not assume any responsibility for the
accuracy or completeness of the Purchaser Information.
The Purchaser and its affiliated entities and their respective
directors, officers, employees and advisers do not assume
any responsibility for the accuracy or completeness of
any information in this Booklet other than the Purchaser
Information.
• the Fonterra Co-operative Council Chair’s letter included in
this Booklet has been prepared by, and is the responsibility of,
the Fonterra Co-operative Council. The Fonterra Co-operative
Council is not responsible for any other information in this
Booklet.
Times and dates
All references to times and dates in this Booklet are to
New Zealand time, unless otherwise stated.
Currency
Unless expressly specified, all references to currency in this
Booklet are to New Zealand dollars.
Diagrams, charts, maps, graphs and tables
Any diagrams, charts, maps, graphs and tables appearing in this
Booklet are illustrative only and may not be to scale.
Effect of rounding
A number of figures, amounts, percentages, prices, estimates,
calculations of value and fractions in this Booklet are subject to
the effect of rounding. Accordingly, actual calculations may differ
from amounts set out in this Booklet and figures in charts and
tables may not add to totals.
Defined terms
Capitalised terms set out in this Booklet have the meanings given
to them in the Glossary in Part Three of this Booklet.

FONTERRA CO-OPERATIVE GROUP LIMITED 2025
SPECIAL MEETING – PROCEDURAL NOTES 4
FONTERRA BOARD CHAIR’S LETTER 6
FONTERRA CO-OPERATIVE COUNCIL CHAIR’S LETTER 7
PART 1
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS OF
FONTERRA CO-OPERATIVE GROUP LIMITED 8
PART 2
EXPLANATORY NOTES TO NOTICE OF SPECIAL MEETING 9
A. RATIONALE FOR THE TRANSACTION 10
B. DESCRIPTION OF THE BUSINESS OF THE MAINLAND GROUP 11
C. OVERVIEW OF THE SALE PROCESS 13
D. SUMMARY OF THE TRANSACTION 13
E. DETAILS OF THE PURCHASER 15
F. FONTERRA GOING FORWARD 17
G. RISKS OF THE TRANSACTION 20
H. NZX LISTING RULES REQUIREMENTS – ACQUISITION OR DISPOSAL
OF ASSETS 21
I. CONSEQUENCES IF THE RESOLUTION IS NOT PASSED 21
J. BOARD RECOMMENDATION 21
PART 3
GLOSSARY 22
APPENDIX A - HISTORICAL PRO FORMA FINANCIAL INFORMATION 23
APPENDIX B - INDEPENDENT ASSURANCE REPORT - KPMG 33
Contents

Fonterra - 2025 Special Meeting and Explanatory Notes4
Fonterra Co-operative Group Limited 2025
Special Meeting – Procedural Notes
Questions
While Shareholders will be able to ask questions via the online
platform during the Special Meeting, we encourage Shareholders
to submit questions online as early as possible prior to the
Special Meeting to ensure that as many questions as possible
are received and addressed at the appropriate time during the
Special Meeting.
Meeting attendees
The Special Meeting is held for the benefit of Shareholders and
their authorised proxies and corporate representatives. Fonterra
management will also be in attendance, as well as the auditors,
Fonterra’s legal advisors and invited members of the media.
Voting
The Special Meeting, which is the meeting at which Shareholders
will vote on the Resolution, is to be held online at 10:30am
on Thursday, 30 October 2025. The Board encourages all
Shareholders to vote on the Resolution. If you are unable to
attend the Special Meeting online, you are encouraged to vote
by post or online before the Special Meeting or appoint a proxy
(or corporate representative if the Shareholder is a corporation)
to vote on your behalf.
Special Meeting documents
This Booklet includes the Notice of Meeting on page 8 and
provides information in relation to the Resolution, the sale of all
the shares of MGHL, and the reasons for proposing this sale. A
Voting/Proxy Form accompanies this Booklet.
The voting threshold for approval of the Resolution is an ordinary
resolution, that is, more than 50% of the votes of Shareholders
who are entitled to vote and who actually vote, must be voted in
favour of the Resolution.
The voting entitlements of Shareholders are set out on page 5.
If you are eligible to vote on the Resolution, you can vote as
follows:
a) By post: You can submit your vote by post.
Please complete the Voting/Proxy Form and post it to the
address on the Voting/Proxy Form (or use the enclosed
freepost envelope).
b) Online prior to the Special Meeting: You can submit your
vote online prior to the Special Meeting by logging in to the
Farm Source website and following the link to the voting site:
www.nzfarmsource.co.nz/haveyoursay
c) Online during the Special Meeting: You can attend the
Special Meeting online, ask questions and vote using the
following link to the virtual meeting platform:
https://fonterra.brandlive.com/Fonterra-Special-Meeting/en
Information on how to attend online (including how to vote
and ask questions virtually during the Special Meeting) is
available on the Fonterra website: https://view.publitas.com/
fonterra-comms/online-meeting-guide-special-meeting-2025/
d) By proxy: See the details on page 5 on appointing a proxy
and how they may vote.
e) By corporate representative: A corporation which is a
Shareholder may appoint a corporate representative to vote
on its behalf in the same manner as that in which it could
appoint a proxy.
You cannot attend the Special Meeting or vote on the Resolution
in person. The Special Meeting will be held online only.
The Returning Officer will contact each proxy or corporate
representative ahead of the Special Meeting to provide them
with the necessary information required to enable them to
participate in, and vote during, the Special Meeting.
In respect of voting by post or online prior to the Special
Meeting, electionz.com Limited has been authorised by the
Board to receive and count all votes as well as all online votes
cast prior to the Special Meeting. All such votes must be received
by the Returning Officer by 10:30am on Tuesday, 28 October
2025.
This Special Meeting will be held as a virtual meeting at 10.30am on Thursday, 30 October 2025. Shareholders may join online
using the instructions set out below.

Fonterra - 2025 Special Meeting and Explanatory Notes5
Voting entitlements
A Shareholder’s voting entitlement is based on their Share
backed milk supply.
‘Supplying Shareholders’ receive one vote for every 1,000
kilograms of milksolids backed by Shares that they supplied
to Fonterra during the season ended 31 May 2025. The voting
entitlement of ‘Secondary Shareholders’ is based on Share
backed milk supply, up to the ‘agreed percentage’ in relation to
Fonterra’s share standard for the relevant supplying farm. By way
of example:
a) if a Supplying Shareholder supplied 100,000 kilograms of
milksolids but held only 75,000 Shares, they would have only
75 votes, whereas if they held 100,000 or more Shares they
would have 100 votes; and
b) if the ‘agreed percentage’ for a Secondary Shareholder is
50% and the supplying farm supplied 100,000 kilograms of
milksolids but the Secondary Shareholder held only 45,000
Shares, they would have only 45 votes, whereas if they held
50,000 or more Shares they would have 50 votes.
If a Supplying Shareholder did not supply last season but now
owns an existing farm that supplied last season, the voting
entitlement for that Supplying Shareholder and any Secondary
Shareholder will be based on that farm’s milksolids supply last
season or on the Board’s estimate of milksolids production for
this season.
In the case of a dry farm conversion and farm amalgamations
/ divisions, voting entitlement is based on one vote for every
estimated 1,000 kilograms of milksolids to be supplied during
the season ending 31 May 2026. Milk supplied on Contract
Supply and milk which is not backed by Shares is excluded from
milksolids production when calculating voting entitlements.
In accordance with the Companies Act 1993, the Board has fixed
Wednesday, 1 October 2025 (following close of trading) as the
time for determining voting entitlements of Shareholders for the
Special Meeting.
Accordingly, those persons who are, at the Voting Entitlement
Time, registered as Shareholders will be entitled to vote at
the Special Meeting in respect of their milk supply, as noted
above, backed by Shares registered in their name at the Voting
Entitlement Time.
A Shareholder’s voting entitlement is shown on their Voting/
Proxy Form, which is enclosed with this pack (if applicable).
This voting entitlement has been determined at the latest
practicable date before printing the Voting/Proxy Form, however,
a Shareholder’s actual voting entitlement may change and will be
determined as at the Voting Entitlement Time. If a Shareholder
appoints a proxy or corporate representative, the proxy or
corporate representative will exercise that Shareholder’s voting
entitlement as described above.
Shareholder questions or requests for corrections relating to
voting entitlements should be sent to electionz.com (email:
info@electionz.com or phone: +64 3 377-3530).
Proxies or corporate representatives
Proxies
Shareholders may appoint a proxy to attend, and vote at, the
Special Meeting on their behalf. If a Shareholder wishes to
appoint a proxy, the Shareholder must ensure that the Returning
Officer receives their completed Voting/Proxy Form by no later
than 10:30am on Tuesday, 28 October 2025. Shareholders can
submit their completed Voting/Proxy Forms:
a) online:
• Login to the Farm Source website
(www.nzfarmsource.co.nz) using your Farm Source login
and password.
• Follow the voting links from the homepage.
• Enter your Personal Identification Number (PIN) and
password provided to you.
or
b) by post: please post the completed Voting/Proxy Form to
the address on the Voting/Proxy Form (or use the enclosed
freepost envelope).
If a Shareholder appoints a proxy, the Shareholder can either
direct the proxy how to vote or let them decide on the
Shareholder’s behalf by ticking the box marked “discretion”. If the
Shareholder does not tick a box for the Resolution, then their
proxy will have discretion on how to vote on the Shareholder’s
behalf.
A proxy need not be a Shareholder. A Shareholder may, if they
wish, appoint the Chair or any other Director as their proxy. The
Chair and all other Directors intend to vote undirected proxies in
favour of the Resolution.
If, in appointing a proxy, the Shareholder does not name a person
to be their proxy (either online or on the enclosed Voting/Proxy
Form), or their named proxy does not attend the Special Meeting,
the Chair will be their proxy and will vote in accordance with
the Shareholder’s express direction. If the Shareholder has not
included an express direction (either online or in the enclosed
Voting/Proxy Form), the Chair will exercise that Shareholder’s
vote in favour of the Resolution.
Once appointed, a proxy can be changed or the Shareholder’s
voting direction to their proxy can be changed by lodging a new
Voting/Proxy Form online or by post as set out above, provided
this is received before 10:30am on Tuesday 28 October 2025.
A Shareholder may revoke the appointment of any proxy by
written notice to Fonterra at its registered office (addressed
to the Returning Officer) by no later than 7:30am on Thursday,
30 October 2025. If you attend the Special Meeting online you
may, but are not required to, revoke your proxy by voting on the
Resolution.
Corporate representatives
A corporation which is a Shareholder may appoint a corporate
representative to vote on its behalf in the same manner as that in
which it could appoint a proxy.
Quorum
The quorum for the Special Meeting is met if not fewer than
50 Shareholders have cast postal votes (including by electronic
means) or are present in person (for this meeting, by being
present online) or by a representative, who between them hold
or represent the holder or holders of not less than two per cent
of the voting rights entitled to be exercised on the Resolution.
Results of voting
The results of voting at the Special Meeting will be posted on
NZX, the Farm Source website and the My Co-op app as soon as
vote counting is complete and the Chair has declared the result.

Fonterra - 2025 Special Meeting and Explanatory Notes6
Fonterra Board Chair’s Letter
Kia ora tātou
On behalf of the Fonterra Board, I’m pleased to share with farmer Shareholders a unanimous recommendation to divest the Co-
operative’s global Consumer and associated businesses to Lactalis for $4.22 billion.
Contained within this Notice of Meeting is the strategic rationale for the divestment, a description of the assets to be divested, and the
expected financial shape of Fonterra following the divestment. It also contains important information on how to record your vote.
The decision to divest the Consumer and associated businesses is significant and one we don’t take lightly. We have examined the
strategic context we operate in, our strengths, and how as a Co-op we create value for our owners.
By far, we do this best through our business-to-business (B2B) Ingredients and Foodservice channels, which collectively generate the
majority of our returns to Shareholders through both the Farmgate Milk Price and dividends.
It is in this context that the Board commenced a process to explore divestment options for our global Consumer and associated
businesses.
We have thoroughly tested the terms and value of both a trade sale and initial public offering (IPO) as divestment options.
Following a highly competitive sale process with multiple interested bidders, your Board is confident that a sale to Lactalis is the highest
value option for the Co-op, including over the long term.
Alongside a strong valuation for the businesses being divested, the sale allows for a full divestment of these assets, is lower risk, and a
faster return of capital to the Co-op’s owners when compared with an IPO.
As the world’s largest dairy company, Lactalis has the scale required to take the Consumer brands and associated businesses to the next
level.
On completion of the divestment, Co-op farmers will continue to benefit from the success of these businesses, with Lactalis to become
one of our most significant Ingredients customers who we’ll partner with through a long-term supply relationship.
At the same time, the divestment removes a significant level of complexity from Fonterra, allowing us to focus on our world-leading
Ingredient and Foodservice businesses, which we believe will flourish.
The Board has considered the implications of a divestment on Fonterra’s financial performance.
The targets and policy settings Fonterra released alongside its strategy in September 2024 are unchanged by a divestment. Specifically,
Fonterra is targeting:
• A capital return of $2.00 per Share, equivalent to $3.2 billion, to farmer Shareholders and unit holders following completion of the sale.
• Maintaining the highest sustainable Farmgate Milk Price.
• Earnings to be back at FY25 levels within three years, offsetting the earnings impact of divestment.
• A target average return on capital of 10-12%, above our 5 year average.
• Returning more of the Co-op’s earnings to Shareholders, through a dividend policy of 60-80%.
These targets are subject to a number of risks and assumptions and no assurance is given as to any level of earnings, dividends or returns.
The Board intends to make a final decision on the amount and timing of the capital return once the Sale Agreement is unconditional, the
Transaction completes and cash proceeds are received in New Zealand and having regard to other relevant factors including Fonterra’s
debt and earnings outlook at the time, and any capital return will be subject to a further Shareholder vote.
The sale is subject to various Conditions, including approval from farmer Shareholders, certain regulatory approvals, and separation of the
businesses from Fonterra.
Subject to satisfaction of all Conditions, Fonterra is targeting completion of the Transaction in the first quarter of the 2026 calendar year.
The Board is seeking a strong mandate from farmer shareholders in support of the divestment – including a high level of voter
participation. We strongly encourage you to read the detail contained within this Notice of Meeting and cast your vote.
The Directors unanimously recommend that you vote in favour of the resolution to approve the sale of the Consumer and
associated businesses.
Ngā mihi
Peter McBride
Chairman

Fonterra - 2025 Special Meeting and Explanatory Notes7
Fonterra Co-operative Council Chair’s Letter
Dear Shareholders
The decision whether Fonterra should divest the Consumer and associated businesses (‘Mainland’) to Lactalis is significant for farmer
shareholders. This will represent a substantial structural change for our Co-operative, and we need to be considered in our decision
making. Our Board of Directors is looking for strong support from farmer shareholders in the vote.
The divestment proposal does not require Council’s support. However, given the magnitude of the decision on the future of Fonterra,
Councillors agreed to the Board’s request to provide shareholders with this letter advising whether Councillors support the Resolution to
sell Mainland.
Your Council has:
• carefully considered the information in this Booklet and in previous communications from Fonterra
• attended shareholder meetings hosted by directors and / or management
• had many conversations with farmer shareholders
• discussed the divestment proposal with the Board
• commissioned our independent analyst Northington Partners to provide an independent assessment of the merits of the proposal
• met with Northington Partners to discuss their report, and
• discussed and debated the proposal among ourselves.
We strongly encourage you to read Northington Partners’ report. It is an independent assessment of the proposed divestment of
Mainland. You can find it on the Fonterra website: www.fonterra.com/fcc.
Northington Partners are of the view the divestment of Mainland is in the best interests of Fonterra shareholders.
In their view:
• the price that will be received for Mainland is attractive and consistent with peer companies and transactions
• the commercial case for divestment is sound
• the sale will make Fonterra a better business, and
• Fonterra has the balance sheet strength to fund the proposed capital return and its near-term investment plans.
A key area of discussion within Council was the expected financial performance of Fonterra after any divestment. Councillors note:
• that Fonterra is targeting earnings to be back at FY25 levels within three years, offsetting the earnings impact of divestment, and
• the target average return on capital of 10 – 12% and dividend policy of 60 – 80% are unchanged by the divestment.
I can advise that 96% (26 of 27) Councillors support the proposal to sell Mainland to Lactalis.
Ultimately, however, the mandate to sell must come from supplying farmer shareholders.
I urge you to use your right of control, and vote.
A well informed and participating group of farmer shareholders is critical to the success of our Co-operative. This vote concerns the
future of our Co-operative. Deciding what that future looks like is a responsibility that we all share.
Tātou, tātou
John Stevenson
Chair, Fonterra Co-operative Council

Fonterra - 2025 Special Meeting and Explanatory Notes8
Notice of Special Meeting of Shareholders of
Fonterra Co-operative Group Limited
PART ONE
Business
To consider and, if thought fit, to pass the following ordinary
resolution:
That the sale of all the shares in Mainland Group Holdings
Limited pursuant to the sale and purchase agreement
with B.S.A. SAS dated 22 August 2025 as described in the
Explanatory Notes, is approved, including for the purposes of
NZX Listing Rule 5.1.1(b).
Voting will be by way of a poll.
Peter McBride
Chair, on behalf of the Board
28 September 2025
Notice is given that the Special Meeting of the Shareholders of Fonterra Co-operative Group Limited will be held online at
10.30am on Thursday, 30 October 2025. Shareholders may join online using the instructions set out in this Booklet.

Fonterra - 2025 Special Meeting and Explanatory Notes9
Explanatory Notes to Notice of Special Meeting
PART TWO
Overview of the Transaction and Key Dates
The Transaction involves the sale by Fonterra of MGHL, the
parent entity of the Mainland Group, to B.S.A. SAS, a member
of the Lactalis group, or (if B.S.A. SAS so nominates) a direct or
indirect wholly-owned subsidiary of B.S.A. SAS, for a purchase
price that is currently estimated to be $4,220,000,000, subject
to some specific adjustments described below. Mainland Group
refers to the entities that together operate the global Consumer
and associated businesses currently operated by Fonterra (other
than the Consumer business in Greater China). On Completion
of the Transaction, Fonterra will enter into various agreements
with members of the Mainland Group (which at that point will be
owned by the Purchaser), including:
• A Raw Milk Supply Agreement, which governs the basis on
which raw (unprocessed) milk is supplied by Fonterra to the
Mainland Group in New Zealand for use in the manufacture
of consumer food products.
• A Global Supply Agreement, which governs the
manufacturing and supply of both ingredients and finished
products by Fonterra for the Mainland Group (and vice versa).
• A Distribution Agreement to enable the Mainland Group and
Fonterra to each have continued access to the territories in
which it currently sells its products, but where it does not
otherwise have its own sales function or distribution network.
Lactalis, headquartered in Laval, France, is a family-owned
business, the largest dairy group in the world and the 9th largest
food group in the world. The Lactalis group employs more
than 85,500 people and had reported revenue of €30.3 billion
(approximately NZ$60 billion) in 2024. The strong international
reputation for New Zealand milk and dairy products, means that
Fonterra will be an essential long-term supplier and partner to
Lactalis, with Lactalis becoming among Fonterra’s top customers
following the Transaction. Lactalis acknowledges the importance
of this aspect of the Transaction for Fonterra and Fonterra’s
Shareholders, and is proud to partner with Fonterra over the
long-term, including through the agreements referenced above
and described further in Section D of this Part Two below.
The Transaction is conditional on a number of Conditions,
including Shareholder approval by ordinary resolution, certain
regulatory approvals, and separation of the businesses from
Fonterra (which is largely within Fonterra’s control), as well
as no material adverse change having occurred in respect of
the Mainland Group prior to Completion. These conditions
are described in more detail in Section D: Summary of the
Transaction in this Part Two of this Booklet.
If the Conditions are satisfied and Completion occurs,
Fonterra currently expects to make a tax free capital return to
Shareholders from the sale proceeds and is targeting a return
amount of $2.00 per Share. The balance of the sale proceeds will
be used to retire debt or applied as working capital. Payment of
the capital return would be subject to a separate Shareholder
vote following Completion. The amount of the capital return
would be confirmed ahead of the capital return Shareholder
vote.
Key Dates relevant for the special shareholder meeting and the
Transaction are set out in the timetable below.
Event Date
Record date for determining
voting entitlements at
the Special Meeting of
Shareholders
1 October 2025 (following
close of trading)
Latest time for receipt of
proxy appointments
10:30am on 28 October 2025
Special Meeting of
Shareholders (online only)
10:30am on 30 October 2025
Targeted date for satisfaction
of all Positive Conditions*
Q1 2026
Targeted Completion Date*Q1 2026
* These dates are indicative only and are very likely to change. They are
dependent upon a number of matters outside of Fonterra’s control.
Fonterra will provide an announcement through NZX when all
Positive Conditions are satisfied. The Board will also update
Shareholders on the likely timing of a Shareholder meeting to
vote to approve a capital return following Completion of the
Transaction.
The following explanatory notes provide more detail in respect
of the Transaction and the business of Fonterra following
Completion of the Transaction.

Fonterra - 2025 Special Meeting and Explanatory Notes10
A. Rationale for the Transaction
Context
To date Fonterra has created value through three key channels – Ingredients, Foodservice and Consumer. The Ingredients and
Foodservice sales channels have consistently utilised the majority of farmers’ milk and generated the majority of the Co-op’s returns to
farmer Shareholders through both the Farmgate Milk Price and dividends.
IngredientsFoodserviceConsumer
This business comprises the sale,
marketing and distribution of products in
bulk format to other manufacturers.
Products range from high-quality powders
through to premium protein solutions.
This business comprises the sale,
marketing and distribution of products in
wholesale format to customers that focus
on out-of-home consumption, including,
for example, quick service restaurants,
hotels, restaurants, caterers, bakeries,
cafes, and institutional providers (such as
healthcare services) for use in production
of meals and other food consumables.
Top selling products include cream cheese,
UHT cream and mozzarella.
This business comprises the sale,
marketing and distribution of branded
dairy products in consumer ready formats,
where the products are packaged for,
and intended to be sold to, individual
consumers (end users). The consumer
product range includes staples such as
fresh milk, cheese, yoghurt and butter.
In FY25:
• Fonterra’s Ingredients channel
represented ~79% of Fonterra’s
New Zealand milk solids sold.
• It contributed $17.6b in revenue and
$2.3b in gross profit.
• Return on capital 10.6%
In FY25:
• Fonterra’s Foodservice channel
represented ~14% of Fonterra’s
New Zealand milk solids sold.
• It contributed $4.8b in revenue and
$892m in gross profit.
• Return on capital 13.2%
In FY25:
• Fonterra’s Consumer channel
represented ~7% of Fonterra’s
New Zealand milk solids sold.
• It contributed $4.0b in revenue and
$996m in gross profit.
• Return on capital 9.4%
Four-year average return on capital
FY22 – FY25: 11.5%
Four-year average return on capital
FY22 – FY25: 13.4%
Four-year average return on capital
FY22 – FY25: 3.0%
Fonterra’s Ingredients and Foodservice businesses have complementary products, manufacturing processes and go-to-market
approaches. The Consumer business utilises different product formats and requires specialised expertise and marketing approaches to
reach consumers around the globe.
Ingredients and Foodservice is where Fonterra can best apply its expertise in dairy science and innovation, along with its manufacturing
and customer partnering capability. These businesses are strong and growing, with ample customer demand.
The Board’s view is that Fonterra does not need the Consumer business to process and distribute all milk profitably. Given this, the
Consumer business must generate an economic return or deliver other strategic benefits to justify Fonterra’s continued and incremental
investment and ownership of the Consumer business.
The Consumer business has not delivered against this benchmark and continues to be Fonterra’s lowest returning channel. It has
consistently delivered a return on capital below 10%, whereas the Foodservice and Ingredients channels deliver returns on capital greater
than 10%.
Even taking into account recent improved performance for the Consumer business, allocating milk to the Ingredients and Foodservice
businesses and releasing capital from the Consumer business is expected to generate more value for Shareholders than retaining and
continuing to invest in the Consumer business.
While Fonterra has a scale position in some Consumer markets, overall performance is inferior to alternative uses of milk and capital. As
a Co-op – with farmer Shareholders – Fonterra also has a higher cost of capital. This raises the bar further in terms of the cost of holding
under-performing assets.
Competitors do not face these same challenges. For example, some competitors are publicly listed or government backed with lower
costs of capital. These players may accept lower returns than Fonterra or pay more of a premium when it comes to acquisitions. In this
circumstance, it is logical that a competitor could view the Consumer sector as a value creating opportunity, even while Fonterra does
not.
For other competitors, a strong Consumer business may already be in their portfolio, providing scale and competitive position such
that superior returns are more likely. Additional acquisitions for these players have the potential to leverage capabilities and generate
synergies, thereby achieving greater returns.
Strategic review
In 2023, Fonterra received unsolicited interest from potential purchasers of the Consumer business. As part of assessing the materiality
and implications of a potential divestment of this business, the Board instigated a strategic review that took into account the above
context on the performance and role of Fonterra’s three sales channels, as well as the Co-op’s operating context today and into the
future.

Fonterra - 2025 Special Meeting and Explanatory Notes11
The strategic review reinforced the strength of Fonterra’s core business, which is to work alongside farmers to collect milk and efficiently
manufacture products to deliver strong returns to farmers and unit holders.
It also gave the Board confidence in the role Fonterra plays in the dairy nutrition value chain, with one of the Co-op’s greatest strengths
being the production of world-class, innovative dairy products sold to customers globally from Fonterra’s home-base in New Zealand.
Off the back of this work, in May 2024 Fonterra announced a step change in its strategic direction. This included a decision to focus
on the Co-op’s Ingredients and Foodservice businesses and explore divestment options for the Consumer business as well as the
integrated businesses Fonterra Oceania and Fonterra Sri Lanka.
The Co-op’s revised strategy, released in September 2024, shows that Fonterra can deliver further value for farmer Shareholders and
unit holders by focusing on the following strategic choices:
• Deliver the strongest farmer offering
• Invest in operations for the future
• Unleash the Ingredients engine
• Keep momentum in Foodservice
• Build on our sustainability position
• Innovation to drive our advantage
Dual-track divestment process
On 10 November 2024, after a scoping study, the Board approved pursuing a dual track sale process for the Consumer and associated
businesses, exploring both a trade sale and an Initial Public Offering (known as an IPO) as divestment options.
The divestment objectives were to:
• Maximise value
• Position Fonterra to deliver on its strategy
• Minimise complexity
• Enhance Fonterra’s licence to operate in New Zealand
• Be executable
• Create a strong Consumer business
The dual-track divestment process culminated with the announcement in August 2025 that Fonterra has agreed the sale of its
Consumer and associated businesses to Lactalis for a total of $4.22 billion, subject to farmer Shareholder approval, separation of the
businesses from Fonterra, and certain regulatory approvals.
The Board’s view is that this agreement is preferable to an IPO as, alongside a strong valuation for the businesses being divested, the
sale would allow for a full divestment of these assets by Fonterra, and a faster return of capital to the Co-op’s owners when compared
with an IPO.
The Board has also given consideration to the fact that, as the world’s largest dairy company, Lactalis has the scale required to take
the Consumer brands and associated businesses to the next level. The Co-op will continue to benefit from their success, with Lactalis
to become one of our most significant Ingredients customers and the Co-op partnering with Lactalis through long-term supply
arrangements with the Mainland Group.
B. Description of the business of the Mainland Group
The Mainland Group
The Mainland Group business includes the global Consumer business currently operated by the Fonterra Group (other than the
Consumer business in Greater China) and a number of associated businesses. Generally, the associated businesses are operationally
integrated with the Consumer business, such that it is not practical to remove them from the Mainland Group.
Mainland Group’s Consumer business is the most significant, contributing 74% of the Mainland Group’s gross profit in the financial year
ended 31 July 2025, with the Foodservice and Ingredients (Australia only) businesses contributing 16% and 10% respectively.
Specifically, the businesses that will be operated by the Mainland Group on Completion of the transaction (“Mainland Business”)
comprise:
(a) in Oceania:
(i) the Consumer and Foodservice businesses in New Zealand, including three manufacturing sites; and
(ii) the Consumer, Foodservice and Ingredients businesses in Australia, including eight manufacturing sites;
(b) in Southeast Asia (Singapore, Malaysia, Indonesia, the Philippines, Thailand and Vietnam), the Consumer business including three
manufacturing sites;
(c) in Sri Lanka, the Consumer and Foodservice businesses, including one manufacturing site;
(d) in the Middle East & Africa, the Consumer and Foodservice businesses, including one manufacturing site; and

Fonterra - 2025 Special Meeting and Explanatory Notes12
(e) export Consumer, Foodservice and Ingredients businesses carried on by certain Mainland Group members in export regions
including the Pacific Islands, the Caribbean and certain Middle East and Indian Ocean territories.
The Mainland Group’s dairy portfolio spans a wide range of products, which can be categorised into the (non-exhaustive) subcategories
below:
• Milk powder: Concentrated dairy product made from fresh milk into a versatile, shelf-stable powder. Products are branded and
range from consumer to bulk ingredients formats, including WMP, SMP, and specialty and nutritional powders (e.g. maternal, infant
and healthy ageing powders).
• Cheese: Mainstream cheese (ie cheese in block form), slice, grated and snacking formats, spreadable and specialty varieties (including
cottage cheese, cream cheese, feta cheese and jar cheese), and bulk cheese.
• Butter and spreads: Butter (from consumer to bulk ingredients formats), spreadable butter, flavoured butter and flavoured spreads.
• Cream: Fresh cream, UHT cream and sour cream.
• Liquid milks: Fresh white milk, UHT milk and flavoured milk.
• Yoghurt: Natural yoghurt, Greek yoghurt, drinking yoghurt and flavoured yoghurt.
The Mainland Group also sells a range of other products that have contributed less than 3% of gross profit in each of FY24 and FY25.
These include whey products, milk protein concentrate, casein, animal nutrition and non-dairy products.
Table 1 - Key metrics by region
1
OceaniaSoutheast AsiaSri LankaMiddle East & Africa
Manufacturing sites3 NZ sites; 8 Australian
sites
3 sites1 site1 site
Sales channels• Consumer
• Foodservice
• Ingredients
2
• Consumer• Consumer
• Foodservice
• Consumer
• Foodservice
Key consumer brands
3
Key product
subcategories (%)
• Cheese (34%)
• Butter and cream (27%)
• Liquid milks (24%)
• Culinary cultured and
yoghurt (8%)
• Milk powder (5%)
• Specialty and nutritional
powders (72%)
• Liquid milks (8%)
• Cheese (6%)
• Whole milk powder (6%)
• Milk powder (94%)
• Butter and cream (3%)
• Milk powder (62%)
• Cheese (24%)
• Butter and cream (13%)
Volume (MT ‘000s)758785966
Revenue (NZD m)3,878614587523
Further financial information about the effect of the sale on the Fonterra Group is set out in Section F: Fonterra Going Forward in this
Part Two of this Booklet.
1
All metrics and financials presented are based on the Mainland Group’s performance in FY25. Percentages for key product subcategories reflect
proportion of FY25 gross profit for the region. List of product subcategories is not exhaustive, with subcategories with a 3% share or below not
presented.
2
Australia only.
3
The Bega brand is licenced in Australia from Bega group companies.

Fonterra - 2025 Special Meeting and Explanatory Notes13
C. Overview of the Sale Process
As has previously been announced, Fonterra has progressed a dual-track process to determine whether to sell the Mainland Group by a
trade sale or by way of an initial public offering of the shares of MGHL and the listing of MGHL on a recognised stock exchange (such as
the NZX and ASX). Fonterra ultimately determined to sell the Mainland Group by way of a trade sale by entering into a sale and purchase
agreement with Lactalis to sell to Lactalis all the shares in MGHL. A summary of that transaction is set out in Section D: Summary of the
Transaction in this Part of this Booklet. The Board elected to proceed by way of a trade sale rather than by a public offering of the shares
of MGHL because, in summary:
• there was a strong level of interest from potential purchasers;
• the trade sale price was superior to what was indicated as likely offer proceeds under an initial public offering;
• the trade sale enables Fonterra to partner with Lactalis through the long-term supply arrangements with the Mainland Group, as a
key Ingredients customer;
• the sale price by way of the initial public offering of the shares of MGHL was uncertain, with this depending upon varying market
conditions;
• the trade sale has fewer risks to Fonterra than an initial public offering; and
• Fonterra can fully dispose of its interest in MGHL, whereas with an initial public offering, there was a risk that Fonterra may have been
required to retain a significant shareholding in MGHL, at least for a period of time. The trade sale therefore allows a faster return of
capital to Fonterra Shareholders, when compared with an IPO.
D. Summary of the Transaction
The Transaction involves the sale by Fonterra Equities Limited (a wholly-owned subsidiary of Fonterra) of all of the shares in Mainland
Group Holdings Limited under a sale and purchase agreement that Fonterra entered into on 22 August 2025 (the “Sale Agreement”).
Fonterra Co-operative Group Limited is a party to the Sale Agreement, agreeing to undertake certain actions, including in relation to
satisfying the Conditions of the Sale Agreement.
The Purchaser is B.S.A. SAS, the parent company of the Lactalis group. Details of the Purchaser and the Lactalis group more generally
are set out in Section E: Details of the Purchaser of this Part of this Booklet.
The key details of the Transaction are noted below.
Purchase Price
The Purchase Price is currently estimated to be $4,220,000,000 but this is subject to adjustments to reflect the actual cash amount,
actual debt amount, and actual working capital of the Mainland Group at Completion. As announced on 26 August 2025, Bega Cheese
Limited has now consented to the change of control in respect of the Transaction, so the Purchase Price referred to above includes the
additional payment of $375,000,000 allocated to the Bega licences.
As is typical for a transaction of this nature, the Purchaser will pay an amount at Completion based on estimates of the cash, debt and
working capital of the Mainland Group at Completion. After the above sums have been determined, an adjustment payment will be
made to reflect the actual cash amount, actual debt amount and actual working capital at Completion. Accordingly, the final purchase
price may increase or decrease as a result.
Conditions
The material conditions in the Sale Agreement that apply before Completion can occur are:
a) Fonterra’s Shareholders approving the Transaction by ordinary resolution (the “Shareholder Approval Condition”);
b) the Purchaser receiving all consents required under the New Zealand Overseas Investment Act (commonly referred to as Overseas
Investment Office (OIO) approval);
c) the requirements of the Australian Foreign Acquisitions and Takeovers Act being satisfied (commonly referred to as Foreign
Investment Review Board (FIRB) approval);
d) satisfaction of the requirements of the merger approval (antitrust/competition law) authorities in each of COMESA (the Common
Market for Eastern and Southern Africa), French Polynesia, Kuwait, Vietnam, the Kingdom of Saudi Arabia and New Caledonia;
e) separation of the Mainland Group from the Fonterra Group,
(the above five conditions are collectively called the “Positive Conditions” for the purposes of this Booklet); and
f) no material adverse change having occurred in respect of Mainland Group prior to Completion.
If all the Conditions are not satisfied or waived (to the extent able to be waived) by 16 June 2026 (or such other date as Fonterra and the
Purchaser may agree), the Sale Agreement can be terminated by either Fonterra or the Purchaser.
There is no assurance that all of the Conditions will be satisfied or waived, so it is possible that Completion does not occur.
If the Resolution to be considered by Fonterra’s Shareholders at this Special Meeting is passed, the Shareholder Approval Condition will
be satisfied.
Completion is not conditional on obtaining any third party consents other than those listed above.

Fonterra - 2025 Special Meeting and Explanatory Notes14
Completion Date
Completion will occur on the last business day of the calendar month in which the last of the Positive Conditions is satisfied or waived,
provided that if the last Positive Condition is satisfied or waived on a date that is less than 10 business days from the end of a calendar
month, Completion will occur on the last business day of the immediately following calendar month. Fonterra and the Purchaser can also
agree a different Completion date.
Fonterra is targeting Completion in the first quarter (Q1) of 2026.
Restraints of Trade
Fonterra has agreed that, for a period of three years following Completion, it will not:
• carry on, operate, own or hold an equity interest in, or otherwise have a legal or beneficial interest in, any business in the nature of
the Mainland Business which is being sold (i.e. a global Consumer business, an Ingredients business in Australia and a Foodservice
business in certain countries); or
• solicit or employ any senior employee of the Mainland Group, subject to various usual exceptions.
There are some exceptions to the restraint, including to permit Fonterra to operate a Consumer business in Greater China, a
Foodservice business anywhere in the world (other than New Zealand, Australia, Sri Lanka, Saudi Arabia or the United Arab Emirates)
and/or an Ingredients business anywhere in the world (other than Australia).
Warranties and Indemnities
Under the Sale Agreement, as is customary, Fonterra provides various warranties and indemnities to the Purchaser in relation to the
Mainland Group and the Mainland Business and tax liabilities of the Mainland Group and which relate to the period prior to Completion.
To mitigate risks of warranty claims against Fonterra, the Purchaser has obtained a warranty and indemnity insurance policy from
a series of insurers. The Sale Agreement provides that the Purchaser will not have any claim or remedy against Fonterra under the
warranties or under the tax indemnity and can only claim against the warranty and indemnity insurance policy. There are some
exceptions relating to circumstances of fraud, claims relating to the title of the shares and for some specific indemnities or other specific
risks.
The intended effect of this is that, while Fonterra gives the warranty and indemnity assurances to the Purchaser about the Mainland
Group and the Mainland Business in the Sale Agreement, as described above, if any of the assurances given by Fonterra prove to be
inaccurate, the Purchaser should only be able to claim against its warranty and indemnity insurance policy and should not have any claim
against Fonterra, except if Fonterra has been fraudulent, there is a problem with title to the shares, or for the specific matters which
Fonterra has agreed to remain responsible and liable to the Purchaser.
The specific matters that Fonterra has agreed to remain responsible predominantly relate to matters which occurred or arose during
Fonterra’s period of ownership of the Mainland Business or which were identified during the due diligence process in respect of the
Transaction, including certain tax matters, and some other risks or liabilities which would have been borne (financially) by Fonterra if it
were to retain the Mainland Business. There are specific caps set on Fonterra’s liability for any claims for those matters. They are not
expected to result in material liability to Fonterra.
Other Agreements
Fonterra and entities in the Mainland Group have entered into, or will enter into, a number of agreements as a result of entering into the
Sale Agreement. These include the following:
• A Separation Agreement, which governs the practical steps to achieve overall separation of the Mainland Group from the Fonterra
Group.
• A Transitional Services Agreement, which sets out the terms on which certain IT and “back-office” services are provided by the
Fonterra Group to the Mainland Group (and vice versa) for a defined period following Completion, to allow each party to transition
from the relevant group arrangements to their own arrangements on a separate basis.
• Intellectual Property licenses to provide for each party to transition away from the use of the other party’s brands and trade
marks within 36 months after Completion, for the licence of certain other technical and brand related intellectual property, and
for the co-existence for the use of the “Anchor” and “Anchor Food Professionals” brands going forward. The Mainland Group will
only use the “Anchor” brand in the Consumer channel (except in New Zealand where it is used in the Foodservice channel). Fonterra
retains ownership of the “Anchor Food Professionals” brand globally, but Fonterra cannot use it in the Consumer channel.
Under the Sale Agreement, Fonterra and Lactalis have agreed to finalise some of the details in these agreements prior to Completion.
Fonterra and Mainland Group will also enter into the following supply and distribution agreements on Completion:
Raw Milk Supply Agreement
The Raw Milk Supply Agreement governs the basis on which raw (unprocessed) milk is supplied by Fonterra to the Mainland Group
in New Zealand for use in the manufacture of consumer food products. This agreement also governs Fonterra’s right to purchase any
excess cream and raw (unprocessed) milk back from the Mainland Group. The Raw Milk Supply Agreement includes the following key
terms:
• The initial term is ten years. The Raw Milk Supply Agreement automatically renews until it is terminated in accordance with its terms.
Either party can terminate the Raw Milk Supply Agreement for convenience on 36 months’ written notice after the first seven years
of the term.
• The Raw Milk Supply Agreement is non-exclusive. Fonterra may supply raw milk to other parties, and the Mainland Group may source
raw milk from other providers.

Fonterra - 2025 Special Meeting and Explanatory Notes15
• The Raw Milk Supply Agreement contains an agreed pricing framework that applies for the life of the contract, unless renegotiated.
The base price payable is based on the Farm Gate Milk Price, plus a premium (dependent on the volume of milk ordered). A collection
and delivery charge is payable in addition to the base price. A further premium is payable for winter milk (being milk supplied from
1 June to 31 July or such other period as may be prescribed by the Dairy Industry Restructuring (Raw Milk) Regulations 2012 (as
amended or replaced from time to time)).
• The Mainland Group is required to pay the winter milk premium for any shortfall in winter milk purchased (as against the forecast it
gives for winter milk).
• It is expected that the Mainland Group will likely purchase a similar volume of raw milk as is currently supplied or made available to
the Mainland Business, however, the Mainland Group can only purchase up to 350 million litres of raw milk per 12-month season (plus
an additional 200 million litres per 12-month season, at a higher premium), in each case excluding any volume of raw milk supplied to
Fonterra in accordance with the Global Supply Agreement (see below).
Global Supply Agreement
The Global Supply Agreement governs the manufacturing and supply of both ingredients and finished products by Fonterra for the
Mainland Group (and vice versa). The Global Supply Agreement includes the following key terms:
• The initial term is three years. Following the initial term, the Global Supply Agreement automatically renews until it is terminated.
Either party can terminate the Global Supply Agreement on 36 months’ written notice after the first three years of the term, unless
otherwise specified on a product-by-product basis.
• The Global Supply Agreement is non-exclusive, and either party may source ingredients or finished products from other providers. It
is expected that the Mainland Group will likely purchase a similar volume of ingredients or finished products as is currently supplied or
made available to the Mainland Business by the broader Fonterra business.
• The Global Supply Agreement contains an agreed pricing methodology for each product type, which will remain fixed for the first
three years of the term. Thereafter, the pricing methodology may be reviewed and reset every three years. The pricing methodology
incorporates a commercial, arm’s length premium (which includes a commercial margin) that aligns with prevailing rates charged to
other customers purchasing ingredients of comparable scale.
• After the first year, an untaken volume fee may be incurred by the buyer (which may be Mainland Group or Fonterra) where the buyer
places orders in any quarter below its forecast volumes for that quarter less the applicable agreed tolerances.
Distribution Agreement
The Distribution Agreement provides for each of the Mainland Group and Fonterra Group to have continued access to the territories in
which it currently sells its products, but where it does not otherwise have its own sales function or distribution network. The Distribution
Agreement includes the following key terms:
• The initial term is three years. Following the initial term, the Distribution Agreement automatically renews unless it is terminated
(either party can terminate the Distribution Agreement for convenience on 36 months’ written notice after the first three years of
the term, and the Distribution Agreement will automatically terminate if the Global Supply Agreement is terminated).
• The Distribution Agreement is non-exclusive, except as otherwise agreed in any particular territory on a case-by-case basis.
• The products to be distributed under the Distribution Agreement in a particular territory are to be purchased and supplied under the
terms of the Global Supply Agreement.
The above is a summary only. Nothing in this Booklet will have the effect of varying or affecting the interpretation of the Sale Agreement
or any other agreement referred to.
E. Details of the Purchaser
About Lactalis
Fonterra has agreed to sell all the shares in MGHL to Lactalis. Lactalis is the largest dairy group in the world and the 9th largest food
group in the world, having 266 production sites across over 50 countries in the Americas, Europe, Africa and Asia Pacific, employing more
than 85,500 people and having reported revenue in 2024 of €30.3 billion (approximately NZ$60 billion). The global headquarters of the
Lactalis group are located in Laval, France.
Lactalis is a family-owned business which was founded in France by André Besnier in 1933 with the name ‘Société Laitière de Laval A.
Besnier et Cie’, where it first produced camembert cheese under the ‘Le Petit Lavallois’ brand name. André Besnier’s son Michel Besnier
took over the family business in 1955 and expanded operations throughout France and Europe, including under the ‘Président’ brand of
brie and camembert cheeses. The business name ‘Lactalis’ was adopted in 1999.
Today, under the leadership and vision of André’s grandson, Emmanuel Besnier, Lactalis Chairman, Lactalis remains at its heart a family
business with roots in the rural and agricultural world and a long-term vision to continue dairy traditions. Lactalis has a strong conviction
that dairy products have a great future. The Lactalis group strives to enhance the natural goodness of milk in all its forms and provide
high-quality and delicious dairy products that consumers around the world can enjoy.
Lactalis’ mission – “Nurturing the Future” – reflects its commitment to delivering healthy, delicious, and affordable dairy products, while
supporting local communities, preserving artisanal know-how, and investing in initiatives to manage and mitigate the impacts of climate
change. Lactalis transforms over 22.8 billion litres of milk annually into trusted dairy products enjoyed worldwide. Working with over
400,000 milk producers worldwide, Lactalis promotes responsible farming, animal welfare and environmental transition.

Fonterra - 2025 Special Meeting and Explanatory Notes16
Lactalis produces a wide range of dairy-based products across all dairy product categories including cheese, liquid milk, chilled dairy,
butter, cream, dairy ingredients and other products. Lactalis is fundamentally focused on consumer goods, with iconic brands such as
Président and Galbani, which cater to millions of consumers worldwide. Lactalis’ other well-known international brands include Parmalat,
Kraft Natural Cheese, Leerdammer, Siggi’s Dairy, Skånemejerier, and Stonyfield Farm.
Lactalis’ growth and development strategies
From its French base, Lactalis has been pursuing an international growth strategy. In addition to its operations in over 50 countries,
Lactalis exports its products to over 150 countries. In 2024, 52% of Lactalis’ global revenue was in Europe, 33% in the Americas and
15% in Africa and Asia Pacific. Closer to New Zealand, Lactalis has consistently expanded its footprint in Australia through successful
acquisitions, including Parmalat acquired in 2011 and which allowed the French group to take control of its Australian operations. This
acquisition marked a strategic turning point for Lactalis. Other acquisitions include of the Lemnos, Longwarry Food Park, Harvey Fresh
and Jalna brands, strengthening its consumer offering and production capabilities in Australia. Lactalis now employs approximately
2,800 employees in Australia. Lactalis knows Fonterra well from this international growth strategy, having previously acquired Fonterra’s
Australian yoghurt and dairy dessert business in 2016 and Fonterra and Nestlé’s Dairy Partners Americas (DPA) Brazil joint venture in
2023. As part of its multi-local strategy, Lactalis works to promote local cultures and customs, with Lactalis’ products and operations in
each market being tailored to the relevant market and respecting regional identities and consumer expectations.
Innovation is central to Lactalis’ development strategy. To keep pace with changing consumer behaviours and to reduce its
environmental footprint, Lactalis strives to innovate constantly. Lactalis seeks to create and develop solutions for every life stage,
from infant to medical nutrition, fresh products to sports supplements, and collaborates with numerous external parties as part of its
innovation activities, including with INRA (the French National Institute for Agricultural Research), engineering schools, universities and
suppliers. Recent innovations by Lactalis have included protein branded yoghurts in Australia, probiotic Probio2 yoghurts in Brazil, basil-
and oregano-infused mozzarella cheese in Italy and vitamin-fortified milk in France.
Lactalis also makes significant investments in the markets in which it operates. In 2024, Lactalis invested more than €1 billion
(approximately NZ$2 billion) in its manufacturing facilities, to support its development and improve industrial capacities, including
in Australia. Lactalis sees these investments as essential to reducing its environmental footprint, and key examples of its recent
investments include installation of more than 65,000 square metres of solar panels in India and Spain and modernisation of wastewater
treatment plants in Brazil.
Lactalis’ attraction to the Mainland Group, and a long-term partnership with Fonterra
The acquisition of the Mainland Group is a strategic priority for Lactalis. Lactalis considers there is significant opportunity for its business
to grow in the Oceania, Asia, Middle East and Africa regions, which, as noted above, currently only represent a small portion of Lactalis’
global revenue. Combining the Mainland Business and its iconic brands with Lactalis’ market leading brands and existing footprint in
Australia and Asia will enable Lactalis to achieve that growth. More generally, Lactalis identified significant potential in the Mainland
Business and its brands and, as Fonterra has noted, considers it has the experience and global scale required to take those to the next
level, developing and growing them in New Zealand and internationally. Through the due diligence process and its visits to Mainland
Group sites including in New Zealand, Lactalis was impressed with the Mainland Business and the quality of its assets, the high-level of
expertise within the business and the professionalism of its employees. Lactalis commends Fonterra on its stewardship of the Mainland
Business and its brands to date.
Lactalis is also proud to become a key partner to Fonterra over the long term. This will include as an acquirer of raw milk from Fonterra,
and indirectly, Fonterra’s Shareholders, and as a supplier of Fonterra’s other products, under the terms of the Raw Milk Supply
Agreement, Global Supply Agreement and Distribution Agreement outlined above. The strong international reputation of New Zealand
milk, and dairy products of New Zealand provenance generally, mean that Fonterra will be an essential long-term supplier and partner to
Lactalis. As a result of the Transaction, Lactalis will become among Fonterra’s top customers. Lactalis recognises that this is an important
aspect of the Transaction for Fonterra and Fonterra’s Shareholders.
Lactalis’ proposed expansion into the New Zealand market under the Transaction
Lactalis currently has limited operations and sales in New Zealand. Lactalis exports a small volume of consumer dairy products to New
Zealand from its operations outside of New Zealand (including the Lemnos haloumi, feta and cream cheese varieties and lactose-free
UHT milk available in New Zealand supermarkets) and has an existing New Zealand subsidiary, New Zealand New Milk, an Auckland-
based consumer ready infant formula manufacturer with two manufacturing facilities. The acquisition of the Mainland Group is a
valuable opportunity for Lactalis to establish a greater presence in the New Zealand market.
Upon Completion occurring, New Zealand will become among the top 20 countries (by global revenue) in which the Lactalis group
operates. The Transaction will result in Lactalis establishing a more significant presence and operations in New Zealand. Following
Completion, Lactalis intends to establish a New Zealand central office for its New Zealand activities. Lactalis considers this an exciting
opportunity for it and for New Zealand.

Fonterra - 2025 Special Meeting and Explanatory Notes17
About the Purchaser entity
B.S.A. SAS is the member of the Lactalis group that has entered into the Sale Agreement as purchaser of all of the shares of MGHL.
B.S.A. SAS is the parent company of the Lactalis group. B.S.A. SAS is a société par actions simplifiée (simplified joint-stock company)
incorporated in France and registered with the Paris trade and companies register (Registre du Commerce et des Sociétés du Tribunal
de Commerce de Paris) under registration number 557 350 253 and having its registered office at Tour Maine Montparnasse, 33 Avenue
du Maine, 75015 Paris, France. As noted above, Lactalis’ global headquarters are in Laval, France. The Chairman (Président) of B.S.A. SAS
is Emmanuel Besnier.
Under the Sale Agreement, B.S.A. SAS is entitled to nominate another member of the Lactalis group to purchase all of the shares
of MGHL at Completion. If B.S.A. SAS wishes to exercise such nomination right, it must do so by giving notice to Fonterra prior to
Completion. B.S.A. SAS has not exercised this right as at the date of finalisation of this Notice of Special Meeting, but if it does so prior
to Completion, the nominated purchaser will be an existing or newly incorporated subsidiary of the Lactalis group.
Further information
Further information about the Lactalis group is available at its English-language website: https://www.lactalis.com/en/le-groupe-lactalis.
F. Fonterra going forward
As noted in Section A: Rationale for the Transaction and Section B: Description of the business of the Mainland Group of this Booklet,
after Completion Fonterra will focus on its Ingredients and Foodservice businesses. The Ingredients and Foodservice businesses have
been the most significant businesses of Fonterra and, with the divestment of the Mainland Group, there can be greater focus on these
businesses going forward.
René Dedoncker, who is part of the senior management team of Fonterra and was appointed as the Chief Executive Officer of the
Mainland Group, will leave Fonterra to continue his role with the Purchaser at the Mainland Group. It is currently not expected that there
will be any further changes to the senior management team of Fonterra as a result of the Transaction.
Fonterra has circa 15,700 employees worldwide. Of these, circa 4,300 are employed by the Mainland Group and will cease to therefore
be part of the Fonterra Group upon Completion of the sale.
Fonterra’s annual audited accounts for the financial year ended 31 July 2025 record the Mainland Business as “held for sale”. As a result,
these accounts provide detail as to the financial effect on Fonterra’s Statement of Financial Position as a result of the sale of the Mainland
Group. A copy of Fonterra’s annual audited accounts for the year ended 31 July 2025 can be found in Fonterra’s annual report for 2025
under the heading “Annual Results 2025” at https://www.fonterra.com/nz/en/investors/results-and-reporting/archived-reports.html
Set out below is certain financial information drawn from the 31 July 2025 annual audited accounts and showing pro forma information
as if the Mainland Group had been sold at that date:
Historical Pro Forma Financial Information
This section shows historical pro forma financial information for Fonterra and the Mainland Group, as if the Transaction had already
happened. The purpose is to help Fonterra Shareholders understand the estimated financial impact of the Transaction on Fonterra’s
past financial performance and position, as if the Transaction had already happened. It is not intended to represent the actual or future
financial performance or position of either Fonterra or the Mainland Group.
The total Fonterra reported historical financial information (“Fonterra Reported”) has been extracted from Fonterra Group’s audited
financial statements for the years ended 31 July 2025 and 31 July 2024. These financial statements were audited by KPMG in line with
International Standards on Auditing (New Zealand), with unmodified opinions. These audited financial statements are available on
Fonterra’s website (www.fonterra.com) and the NZX website (www.nzx.com).
The historical pro forma financial information has been prepared using data from Fonterra’s accounting records, which are the basis of
the audited consolidated financial statements. Pro forma adjustments have been made to reflect the impacts of the Sale Agreement,
and associated agreements entered into with Lactalis. All pro forma intra-group transactions and balances between Fonterra and
the Mainland Group have been eliminated to align the pro forma information with Fonterra Reported numbers (“Pro Forma Group
Eliminations”).
Details of the basis of preparation of historical pro forma financial information and pro forma adjustments made are included in
Appendix A.
An independent assurance provider’s report on both the Fonterra reported historical financial information and the historical pro forma
financial information for Fonterra and the Mainland Group is provided in Appendix B.

Fonterra - 2025 Special Meeting and Explanatory Notes18
1
Depreciation and amortisation presented above have been extracted from cost of goods sold and operating expenses line items within Fonterra
reported statement of profit or loss.
2
Tax treatment change effective from FY25, Fonterra has exhausted its NZ tax losses and NZ tax expenses will generate imputation credits from FY25
onwards. As part of the change, dividends on supply backed shares are no longer treated as a business expense by Fonterra.
3
Includes $106 million of divestment transaction costs for the year ended 31 July 2025.
Historical Pro Forma Statements of Financial Position as at 31 July 2025
NZD $m
Fonterra
Reported
Fonterra
Historical Pro
Forma
Pro Forma
Group
Eliminations
Mainland Group
Historical Pro
Forma
Total assets17,52713,710(197)4,014
Total liabilities(9,189)(8,145)197(1,241)
Net assets8,3385,565-2,773
Historical Reported and Pro Forma Statements of Profit or Loss
NZD $m
For the year ended 2025For the year ended 2024
Fonterra
Reported
Fonterra
Historical
Pro Forma
Pro Forma
Group
Eliminations
Mainland
Group
Historical
Pro Forma
Fonterra
Reported
Fonterra
Historical
Pro Forma
Pro Forma
Group
Eliminations
Mainland
Group
Historical
Pro Forma
Revenue from sale of goods26,45023,758(2,909)5,60122,82220,154(2,394)5,062
Cost of goods sold (excluding
depreciation and amortisation)
(21,818)(20,203)2,909(4 , 524)(18,560)(16,854)2,394(4 ,10 0)
Gross profit4,6323,555-1,0774,2623,300-962
Operating expenses (excluding
depreciation and amortisation)
(2,392)(1,656)-(736)(2,182)(1,585)-(597)
Other127113-1410793-14
EBITDA2,3672,012-3552,1871,808-379
Depreciation and amortisation
1
(635)(532)-(103)(627)(521)-(106)
Operating profit (EBIT)1,7321,480-2521,5601,287-273
Net finance costs(186)(184)-(2)(157)(156)-(1)
Profit before tax1,5461,296-2501,4031,131-272
Tax expense
2
(4 6 7)(360)-(107)(235)(135)-(100)
Profit after tax1,079936-1431,168996-172
Normalisation adjustments
3
106--106----
Normalised operating profit
(EBIT)
1,8381,480-3581,5601,287-273
Normalised profit after tax1,185936-2491,168996-172

Fonterra - 2025 Special Meeting and Explanatory Notes19
Unless stated otherwise, all amounts are shown in New Zealand dollars (NZD), rounded to the nearest million. Totals may not always add
up due to rounding.
The proceeds from the Transaction are not included in the historical pro forma financial information and ratios presented above.
Supplementary adjusted historical pro forma financial ratios have been presented below to illustrate the likely impact of the proceeds
from the Transaction on these ratios as at 31 July 2025.
Supplementary Adjusted Historical Pro Forma Financial Ratios as at 31 July 2025
NZD $m
Fonterra Adjusted
Historical Pro
Forma
Adjusted net debt1,814
Gearing ratio22.2%
Debt to EBITDA ratio 0.9x
The supplementary adjusted historical pro forma financial ratios have been prepared on the basis that the remaining proceeds from
the Transaction, amounting to approximately $800 million, are applied to debt repayment as at 31 July 2025. The remaining proceeds
are calculated as total Transaction proceeds of $4.22 billion, less a $3.2 billion distribution to Fonterra Shareholders and estimated
transaction costs of $200 million yet to be incurred. Debt repayments are assumed to occur on 31 July 2025. Accordingly, the above
calculations do not reflect any potential impact on finance costs or the associated tax effects. In addition, the calculations do not
incorporate any potential settlement adjustments (for example, in relation to working capital or net debt).
Fonterra currently intends to return $3.2 billion ($2.00 per share) to Fonterra Shareholders as a tax-free capital return from the sale
proceeds. This payment will require Shareholder approval once the Transaction is complete, and the proceeds are received. The final
amount will be confirmed and communicated to Shareholders before a Shareholder vote on the capital return. The remaining sale
proceeds, expected to be approximately $1 billion less transaction costs yet to be incurred, will be used for growth initiatives, debt
reduction, or working capital.
Key assumptions supporting pro forma adjustments
a) Proceeds from the Transaction: The proceeds from the Transaction are not included in the historical pro forma financial information,
and as a result not included in the pro forma historical financial ratios presented. A supplementary table has been provided to
illustrate the likely impact of the proceeds from the Transaction on the historical pro forma ratios as at 31 July 2025.
b) Raw Milk Supply Agreement, Global Supply Agreement and Distribution Agreement: Pro forma adjustments reflect the estimated
impact of these agreements (see Part Two, Section D). Pro forma adjustments do not include changes to trading terms. Actual results
may differ from these estimates.
c) Transitional Services Agreement: A Transitional Services Agreement (see Part Two, Section D) will be entered into for a defined period.
The costs of delivering these services have been included in discontinued operations in Fonterra’s financial statements.
d) Standalone Corporate Costs: Standalone corporate cost pro forma adjustments have not been made in the Mainland Group’s
historical pro forma statement of profit or loss, as Lactalis will set up its own corporate structure and cost base.
e) Divestment costs: A normalisation adjustment of $106 million of divestment transaction costs has been made to the 31 July 2025
Fonterra reported results and the Mainland Group historical pro forma results.
f) Intercompany Borrowings: Intercompany borrowings between Fonterra and Mainland Group are fully eliminated in Fonterra’s
consolidated financial statements. As a result, repayment or restructuring is not reflected in the historical pro forma financial
information. The Transaction is assumed to settle on a debt-free basis.
g) Dividend Policy: The Transaction is not expected to change Fonterra’s current dividend policy of distributing 60–80% of reported net
profit after tax (excluding abnormal gains).
Historical Pro Forma Financial Ratios as at 31 July 2025
NZD $mFonterra Reported
Fonterra Historical
Pro Forma
Mainland Group
Historical Pro
Forma
Adjusted net debt2,6202,6146
Gearing ratio23.9%32.0%
Debt to EBITDA ratio1.1x1.3x
Average capital employed (13 month rolling average)12,3489,3473,001
Return on capital10.9%11.6%8.8%

Fonterra - 2025 Special Meeting and Explanatory Notes20
G. Risks of the Transaction
Below is a summary of the key risks identified which relate to the Transaction. These risks relate to the Transaction and should not
be regarded as a summary of the risks that apply to Fonterra or its business generally, whether before or after Completion of the
Transaction:
a) Transaction risk:
Risk: The Transaction carries risks such as delays in the satisfaction of Positive Conditions (including separation) or final price
adjustments that may prevent or reduce the value of the sale of the Mainland Group. It is also possible that the Conditions are not
satisfied and the Transaction does not proceed to Completion.
Mitigant: Proceeding with a trade sale removes market risk (which is inherent in an IPO process). Other risks have been considered
and sought to be minimised during the Transaction (for example, advancing regulatory approvals) and its execution (for example,
by agreeing adjustment mechanisms and protections) to maximise certainty of outcome. The parties are required to endeavour to
satisfy the Positive Conditions. If the Conditions are not satisfied the Transaction will not proceed to Completion and Fonterra will
remain the owner of the Mainland Group and the Mainland Business for the time being.
b) Milk placement risk:
Risk: The Mainland Group may choose to make consumer products with milk which is supplied by competitors, reducing volumes
purchased from Fonterra earlier than anticipated.
Potential mitigant: Fonterra considers that it can place all of its milk without the Mainland Business by redirecting product to
other sales channels. The Mainland Business uses a small proportion (around 9%) of Fonterra’s New Zealand-sourced milk. Shifting
placement of the remainder to be sold through the Ingredients and Foodservice channels, in the event Mainland Group no longer
purchased milk from Fonterra, is unlikely to have a noticeable effect on global commodity prices.
c) Increased volatility in business performance:
Risk: Divesting the Consumer channel theoretically removes a “natural hedge” to commodity price cycles.
Potential mitigant: Historically, the Consumer channel has been Fonterra’s lowest-return channel based on return on capital and has
not provided a material hedge; reallocating milk to high-return Ingredients and Foodservice channels and using financial hedging tools
is a more effective way to hedge commodity price risk.
d) Future Foodservice competitor:
Risk: Mainland Group, and/or Lactalis, may enter the Foodservice channel as a competitor of Fonterra in markets such as Southeast
Asia.
Mitigant: This risk exists today as Lactalis already operates a global Foodservice division. Fonterra cannot and does not seek to
prevent competition and will focus on delivering on its Foodservice strategy.
e) Brand risk:
Risk: The Mainland Group will own (with some limited exceptions, e.g., not in Greater China) and use the “Anchor” brand. The Fonterra
Group will own and use the “Anchor Food Professionals” brand. The use by each party of the same “Anchor” name in these relevant
contexts may create risks (e.g., if a party damages the reputation of the brand).
Mitigant: While Anchor Food Professionals and Anchor share a name, they are not identical brands and the co-existence
arrangements under the Trade Mark Agreement set out clear guardrails around how each of the Mainland Group and Fonterra Group
can use their respective brands. Both parties are committed to maintaining high standards to protect the reputation of the brands.
f) Post-sale Transaction risk:
Risk: Unforeseen liabilities or claims might emerge after the sale, potentially resulting in costs for or liability to (including as a
damages payment) Fonterra.
Mitigant: The requirement for the Purchaser to have a warranty and indemnity insurance policy in place, which is specified as the
sole means of recourse for the Purchaser for most warranty and tax indemnity claims, is intended to largely shield Fonterra from
this risk. Fonterra should only be liable where specific indemnities apply or in the unlikely event of an issue with title or for fraud.
In respect of those specific indemnities, certain limitations and contractual protections have been put in place, and Fonterra is
comfortable that the risk retained or assumed by Fonterra is appropriate in the circumstances.
Fonterra’s role in the New Zealand Consumer market
Fonterra is mindful of the role that the Consumer business and its products fulfil in the New Zealand consumer market, many of which
are household names. The sale of these brands and Consumer business under the Transaction may give rise to concerns and sentiment
in New Zealand. Fonterra has had careful regard to this and considers Lactalis to be a reputable and responsible custodian of the brands
and long term supplier to New Zealand consumers.
The Transaction will allow Fonterra to focus on its core co-operative activities (collecting and processing milk for B2B sales). The sale
of the Mainland Group is intended to strengthen Fonterra and deliver better returns to farmers, and in turn benefit the New Zealand
economy and support Fonterra’s ongoing commitment to New Zealand dairy.

Fonterra - 2025 Special Meeting and Explanatory Notes21
H. NZX Listing Rules requirements – acquisition or disposal of assets
Under NZX Listing Rule 5.1.1 a listed issuer must obtain shareholder approval for an acquisition or disposal of assets where the
transaction or related series of transactions (a) would significantly change the nature of the issuer’s business or (b) involves a “Gross
Value” which exceeds 50% of the issuer’s “Average Market Capitalisation” (as each of those terms are defined in the NZX Listing Rules).
The Gross Value of the assets being acquired in connection with the Transaction exceeds 50% of Fonterra’s Average Market
Capitalisation as at 22 August 2025 (being the date that Fonterra entered into the Sale Agreement and announced the Transaction
through NZX). Accordingly, Shareholder approval for the Transaction is required under NZX Listing Rule 5.1.1(b). The Board does not
consider that the Transaction will significantly change the nature of Fonterra’s business.
I. Consequences if the Resolution is not passed
If Shareholders do not approve the Resolution, then:
• The Transaction will not proceed;
• A capital return will not be made;
• Fonterra will continue to own the Consumer and associated businesses and bear the risks and financial outcomes of its performance;
and
• The Share price may change.
J. Board Recommendation
The Board of Fonterra unanimously recommends that Shareholders vote in favour of the Resolution to approve the sale of all the
shares of MGHL to Lactalis. All Directors who hold Shares intend to cast their votes in favour of the Resolution.

Fonterra - 2025 Special Meeting and Explanatory Notes22
Board means the board of directors of Fonterra.
Booklet means this Notice of Special Meeting and explanatory
notes in Part Two of this Booklet in relation to the proposed sale
of MGHL, the parent company for the Mainland Group.
Chair means the chair of the Board.
Completion means the time at which completion takes place
under the Sale Agreement.
Conditions means the conditions of the Sale Agreement that
must be satisfied (or waived) before Completion can occur, with
the material list of those conditions described in Section D of
Part Two of this Booklet under the sub-heading “Conditions”.
Consumer means the consumer business channel described in
Section A of Part Two of this Booklet.
Director means a director of Fonterra.
Distribution Agreement means the Distribution Agreement
described in Section D of Part Two of this Booklet.
Fonterra, the Co-operative or Co-op means Fonterra
Co-operative Group Limited. Where the context requires it
means the relevant Fonterra subsidiary which will be part of the
Fonterra Group after the sale of the Mainland Group.
Fonterra Group means Fonterra and its subsidiaries and, after
Completion, excludes the Mainland Group.
Foodservice means the foodservice business channel described
in Section A of Part Two of this Booklet.
FY means financial year.
Global Supply Agreement means the Global Supply Agreement
described in Section D of Part Two of this Booklet.
Ingredients means the ingredients business channel described
in Section A of Part Two of this Booklet.
Lactalis or Purchaser means B.S.A. SAS, a société par actions
simplifiée (simplified joint-stock company) incorporated in
France and registered with the Paris trade and companies
register (Registre du Commerce et des Sociétés du Tribunal de
Commerce de Paris) under registration number 557 350 253, and
being a member of the Lactalis group of companies.
Mainland Business means the business of the Mainland Group
after Completion as described in Section B of Part Two of this
Booklet.
Mainland Group means MGHL and its subsidiaries.
MGHL means Mainland Group Holdings Limited.
Notice of Meeting means this notice of meeting, including the
explanatory notes.
NZ IFRS means New Zealand equivalents to International
Financial Reporting Standards.
NZX means NZX Limited.
NZX Listing Rules means the NZX Main Board listing rules in
force from time to time, as they apply to Fonterra.
NZX Main Board means the main board equity securities
market operated by NZX.
Positive Conditions means the Conditions described in
paragraphs (a) to (e) of Section D of Part Two of this Booklet
under the sub-heading “Conditions”.
Purchaser Information means information about the Purchaser
provided given by the Purchaser to Fonterra in writing for
inclusion in this Booklet, and is contained in Section E of Part Two
of this Booklet.
Raw Milk Supply Agreement means the Raw Milk Supply
Agreement described in Section D of Part Two of this Booklet.
Resolution means the ordinary Shareholder resolution set out
on page 8 of this Booklet to approve the Transaction.
Sale Agreement means the agreement for sale and purchase of
the shares of MGHL between Fonterra Equities Limited, Fonterra
and B.S.A. SAS dated 22 August 2025.
Share means a co-operative share in the capital of Fonterra.
Shareholder means a person recorded in Fonterra’s register of
shareholders as a holder of a Share at the Voting Entitlement
Time.
Special Meeting means the special meeting described on
page 8 of this Booklet.
Transaction means the sale of all the shares of MGHL pursuant
to the Sale Agreement, as described in this Booklet.
Voting Entitlement Time means Wednesday, 1 October 2025
(following close of trading).
Glossary
PART THREE

Fonterra - 2025 Special Meeting and Explanatory Notes23
This appendix sets out the basis of preparation and detailed supporting schedules and pro forma adjustments made in preparing the
historical pro forma financial information and Fonterra reported historical financial information as set out in Section F: Fonterra Going
Forward of Part Two of this Booklet.
Historical pro forma financial information for Fonterra and Mainland Group post Transaction, comprises of:
• Fonterra historical pro forma statements of profit or loss for the years ended 31 July 2025 and 31 July 2024;
• Mainland Group historical pro forma statements of profit or loss for the years ended 31 July 2025 and 31 July 2024;
• Fonterra historical pro forma statement of financial position as at 31 July 2025; and
• Mainland Group historical pro forma statement of financial position as at 31 July 2025.
Fonterra reported historical financial information, comprises of:
• Fonterra reported historical statements of profit or loss for the years ended 31 July 2025 and 31 July 2024; and
• Fonterra reported historical statements of financial position as at 31 July 2025.
Basis Of Preparation
The historical pro forma financial information is intended to assist Fonterra Shareholders in understanding the likely estimated financial
effect of the Transaction on Fonterra Group’s historical financial performance and position. It is not intended to represent the actual
or future financial performance or position of either Fonterra or Mainland Group. When marketing the Mainland business for sale,
additional standalone costs of $49 million (FY24: $39 million) and further quality of earnings adjustments that reduce earnings by
$15 million (FY24: $11 million) were factored in. These amounts are not included in the Mainland Group pro forma adjustments.
By its nature, historical pro forma financial information is illustrative and does not purport to represent:
• the actual or future financial performance of Fonterra or Mainland Group for the periods presented; or
• the financial performance or financial position that would have resulted had Fonterra operated without Mainland Group as a
subsidiary during those periods presented, principally because:
• Fonterra did not operate independently of Mainland Group during the periods for which the financial information is presented;
• the historical pro forma financial information may not reflect the strategies or operational decisions that Fonterra might have
pursued without Mainland Group; and
• Fonterra may have been exposed to different financial and business risks had it operated without Mainland Group as a subsidiary.
The Fonterra reported historical financial information has been extracted from Fonterra Group’s audited financial statements for the
years ended 31 July 2025 and 31 July 2024. These financial statements were audited by KPMG in line with International Standards
on Auditing (New Zealand), with unmodified opinions. These audited financial statements are available on Fonterra’s website
(www.fonterra.com) and the NZX website (www.nzx.com).
The historical pro forma financial information has been prepared using data from Fonterra’s accounting records, which are the basis of
the audited consolidated financial statements. Pro forma adjustments have been made to reflect the impacts of the Sale Agreement,
and associated agreements entered into with Lactalis.
This appendix sets out the basis of preparation and detailed supporting schedules describing the pro forma adjustments made to the
Fonterra reported historical financial information in order to present the historical pro forma financial information.
The independent assurance provider has prepared an independent assurance provider’s report on the Fonterra reported historical
financial information and the Fonterra and Mainland Group historical pro forma financial information. A copy of this report is included in
Appendix B.
Unless stated otherwise, all amounts are shown in New Zealand dollars (NZD), rounded to the nearest million. Totals may not always add
up due to rounding.
Appendix A
Historical Pro Forma Financial Information

Fonterra - 2025 Special Meeting and Explanatory Notes24
Detailed supporting schedules and descriptions of pro forma adjustments
Fonterra reported historical statements of profit or loss
For the years ended 31 July 2025 and 31 July 2024
Compiled by combining the extracted results of:
• continuing operations from Fonterra Group’s Statement of profit or loss and other comprehensive income; and
• discontinued operations from note 2(b) of the Fonterra Group financial statements (discontinued operations).
For the year ended 31 July 2024, the Fonterra Group reported historical financial information excludes a $40 million post-tax loss on
sale (equivalent to a $33 million pre-tax operating loss) relating to DPA Brazil. As a result, these amounts will not reconcile directly to
discontinued operations.
NZD $m
For the year ended 2025For the year ended 2024
Fonterra
Reported
Continuing
operations
Discontinued
operations
Fonterra
Reported
Continuing
operations
Discontinued
operations
Revenue from sale of goods26,45024,1112,33922,82220,4232,399
Cost of goods sold (excluding depreciation and
amortisation)
(21,818)(20,460)(1,358)(18,560)(1 7, 0 6 2)(1,498)
Gross profit4,6323,6519814,2623,361901
Operating expenses (excluding depreciation
and amortisation)
(2,392)(1,672)(720)(2,182)(1,591)(591)
Other127113141079314
EBITDA2,3672,0922752,1871,863324
Depreciation and amortisation
1
(635)(532)(103)(627)(521)(106)
Operating profit (EBIT)1,7321,5601721,5601,342218
Net finance costs(186)(184)(2)(157)(156)(1)
Profit before tax1,5461,3761701,4031,186217
Tax expense(4 6 7)(372)(95)(235)(139)(96)
Profit after tax1,0791,004751,1681,047121
1
Depreciation and amortisation presented above have been extracted from cost of goods sold and operating expenses line items within Fonterra
reported statement of profit or loss.

Fonterra - 2025 Special Meeting and Explanatory Notes25
Fonterra reported historical pro forma statements of profit or loss
For the years ended 31 July 2025 and 31 July 2024
Compiled by extracting the results of continuing operations. Pro forma adjustments have been made to:
• remove the effects of Fonterra’s existing transfer pricing arrangements related to Mainland Group that will cease post divestment;
• recognise the impact of the Raw Milk Supply Agreement, Global Supply Agreement, and Distribution Agreement (the “LT S A s”); and
• reflect changes to the Transaction perimeter not presented in discontinued operations.
Year ended 31 July 2024
NZD $m
Fonterra Reported
- Continuing
operations
Pro Forma
Adjustments
Fonterra Historical
Pro Forma
Revenue from sale of goods20,423(269)20,154
Cost of goods sold (excluding depreciation and amortisation)(1 7, 0 6 2)208(16,854)
Gross profit3,361(61)3,300
Operating expenses (excluding depreciation and amortisation)(1,591)6(1,585)
Other93-93
EBITDA1,863(55)1,808
Depreciation and amortisation
1
(521)-(521)
Operating profit (EBIT)1,342(55)1,287
Net finance costs(156)-(156)
Profit before tax1,186(55)1,131
Tax expense(139)4(135)
Profit after tax1,047(51)996
1
Depreciation and amortisation presented above have been extracted from cost of goods sold and operating expenses line items within Fonterra
reported statement of profit or loss.
1
Depreciation and amortisation presented above have been extracted from cost of goods sold and operating expenses line items within Fonterra
reported statement of profit or loss.
Year ended 31 July 2025
NZD $m
Fonterra Reported
- Continuing
operations
Pro Forma
Adjustments
Fonterra Historical
Pro Forma
Revenue from sale of goods24,111(353)23,758
Cost of goods sold (excluding depreciation and amortisation)(20,460)257(20,203)
Gross profit3,651(96)3,555
Operating expenses (excluding depreciation and amortisation)(1,672)16(1,656)
Other113-113
EBITDA2,092(80)2,012
Depreciation and amortisation
1
(532)-(532)
Operating profit (EBIT)1,560(80)1,480
Net finance costs(184)-(184)
Profit before tax1,376(80)1,296
Tax expense(372)12(360)
Profit after tax1,004(68)936

Fonterra - 2025 Special Meeting and Explanatory Notes26
Year ended 31 July 2025
NZD $m
Fonterra Reported
- Discontinued
operations
Pro Forma
Adjustments
Mainland Group
Historical Pro Forma
(Pre Eliminations)
Revenue from sale of goods2,3393,2625,601
Cost of goods sold (excluding depreciation and amortisation)(1,358)(3,166)(4 , 524)
Gross profit981961,077
Operating expenses (excluding depreciation and amortisation)(720)(16)(736)
Other14-14
EBITDA27580355
Depreciation and amortisation
1
(103)-(103)
Operating profit (EBIT)17280252
Net finance costs(2)-(2)
Profit before tax17080250
Tax expense(95)(12)(107)
Profit after tax7568143
1
Depreciation and amortisation presented above have been extracted from cost of goods sold and operating expenses line items within Fonterra
reported statement of profit or loss.
Mainland Group historical pro forma statements of profit and loss
For the years ended 31 July 2025 and 31 July 2024
Compiled by extracting the results of discontinued operations. Pro forma adjustments and pro forma eliminations were made to:
• remove $8 million post-tax profit in relation to Soprole (FY24: $40 million post-tax loss in relation to DPA Brazil (equivalent to a
$33 million pre-tax operating loss);
• reverse historical intercompany eliminations;
• remove the effects of Fonterra’s existing transfer pricing arrangements related to Mainland Group which will cease post divestment;
• recognise the impact of the LTSAs; and
• reflect changes to the Transaction perimeter not presented in discontinued operations.
Following these pro forma adjustments, the Mainland Group historical pro forma (pre eliminations) statements of profit or loss were
derived.
Discontinued operations results include $106 million of divestment transaction costs that have not been normalised in the Mainland
Group historical pro forma statements of profit or loss. Normalising these costs would increase Mainland Group’s operating profit (EBIT)
for the year ended 31 July 2025 by $106 million.

Fonterra - 2025 Special Meeting and Explanatory Notes27
Fonterra historical pro forma statement of financial position
As at 31 July 2025
The Fonterra reported historical statement of financial position has been compiled by extracting total assets and liabilities from the
Fonterra Group consolidated financial statements as at 31 July 2025.
The reported historical statement of financial position has been compiled by extracting total assets and liabilities from the Fonterra
Group consolidated financial statements as at 31 July 2025 and deducting assets and liabilities classified as held for sale (excluding $27
million and $5 million of unrelated assets and liabilities). Pro forma adjustments were made to:
• add back Mainland Group’s trade balances with Fonterra at 31 July 2025 (extracted from Fonterra’s accounting records), which
following the Transaction will become external trade balances; and
• reflect changes to the Transaction perimeter not classified as held for sale in Fonterra Group’s statement of financial position.
NZD $m
Fonterra Reported
- Total Group less
Held for sale
Pro Forma
Adjustments
Fonterra Historical
Pro Forma
Total assets13,712(2)13,710
Total liabilities(8,220)75(8,145)
Net assets5,492735,565
1
Depreciation and amortisation presented above have been extracted from cost of goods sold and operating expenses line items within Fonterra
reported statement of profit or loss.
Year ended 31 July 2024
NZD $m
Fonterra Reported
- Discontinued
operations
Pro Forma
Adjustments
Mainland Group
Historical Pro Forma
(Pre Eliminations)
Revenue from sale of goods2,3992,6635,062
Cost of goods sold (excluding depreciation and amortisation)(1,498)(2,602)(4 ,10 0)
Gross profit90161962
Operating expenses (excluding depreciation and amortisation)(591)(6)(597)
Other14-14
EBITDA32455379
Depreciation and amortisation
1
(106)-(106)
Operating profit (EBIT)21855273
Net finance costs(1)-(1)
Profit before tax21755272
Tax expense(96)(4)(100)
Profit after tax12151172

Fonterra - 2025 Special Meeting and Explanatory Notes28
Mainland Group historical pro forma statement of financial position
As at 31 July 2025
Compiled by extracting assets and liabilities classified as held for sale in the Fonterra Group historical financial statements as at 31 July
2025. Pro forma adjustments were made to:
• exclude $27 million and $5 million of unrelated assets and liabilities;
• add back Mainland Group’s trade balances with Fonterra at 31 July 2025 (extracted from Fonterra’s accounting records), which
following the Transaction will become external trade balances; and
• reflect changes to the Transaction perimeter not classified as held for sale.
NZD $m
Fonterra Reported -
Held for sale
Pro Forma
Adjustments
Mainland Group
Historical Pro
Forma
Total assets3,8151994,014
Total liabilities(969)(272)(1,241)
Net assets2,846(73)2,773
Fonterra historical pro forma adjusted net debt, gearing and debt to EBITDA ratios
As at 31 July 2025
The Fonterra reported adjusted net debt, gearing and debt to EBITDA ratios have been extracted from the Fonterra Group financial
statements as at 31 July 2025.
The Fonterra historical pro forma adjusted net debt and gearing ratios have been calculated by adjusting the reported ratios to reflect:
• the exclusion of Mainland Group assets and liabilities classified as held for sale; and
• changes to the Transaction perimeter not presented in discontinued operations.
The proceeds from the Transaction are not included in the historical pro forma financial information, and as a result not included in the
pro forma historical financial ratios presented.
The Fonterra historical pro forma debt to EBITDA ratio has been calculated using continuing operations normalised EBITDA (which
excludes Soprole profit after tax of $8 million) as at 31 July 2025, adjusted to:
• remove the effects of Fonterra’s existing transfer pricing arrangements related to Mainland Group which will cease following the
divestment;
• recognise the impact of the LTSA’s; and
• reflect changes to the Transaction perimeter not classified as held for sale.

Fonterra - 2025 Special Meeting and Explanatory Notes29
NZD $mFonterra Reported
Pro Forma
Adjustments
Fonterra Historical
Pro Forma
Total borrowings (including lease liabilities)3,138(1)3,137
Add: Bank overdraft30(2)28
Less: Cash and cash equivalents(309)7(302)
Add: Borrowings attributable to disposal groups held for sale104(104)-
Less: Cash and cash equivalents attributable to disposal groups held for
sale
(94)94-
Add: Cash adjustment of 25% for cash held by subsidiaries49-49
Less: Derivative used to manage changes in hedged risks on debt
instruments
(298)-(298)
Adjusted net debt2,620(6)2,614
Equity excluding hedge reserves8,327(2,773)5,554
Total capital10,947(2,779)8,168
Gearing ratio23.9%32.0%
Adjusted net debt2,620(6)2,614
Profit after tax1,079(151)928
Add: Net finance costs from continuing operations184-184
Add: Net finance costs from discontinued operations2(2)-
Add: Tax expense from continuing operations372(12)360
Add: Tax expense from discontinued operations95(95)-
Total Group operating profit (EBIT)1,732(260)1,472
Add: Depreciation and amortisation from continuing operations532-532
Add: Depreciation and amortisation from discontinued operations103(103)-
Less: EBITDA relating to divestments---
Add: Normalisation adjustments106(106)-
Less: Share of profit of equity accounted investees(10)-(10)
Less: Net foreign exchange gains from continuing operations(9)-(9)
Less: Net foreign exchange gains from discontinued operations(7)7-
Total normalised EBITDA excluding divestments, share of profit of
equity accounted investees and foreign exchange gains/losses
2,4471,985
Debt to EBITDA ratio1.1x1.3x

Fonterra - 2025 Special Meeting and Explanatory Notes30
Mainland Group historical pro forma adjusted net debt
As at 31 July 2025
The Mainland Group historical pro forma adjusted net debt has been calculated by:
• extracting relevant assets and liabilities held for sale in Fonterra Group consolidated financial statements as at 31 July 2025 (excluding
$27 million and $5 million of unrelated assets and liabilities); and
• reflecting changes to the Transaction perimeter not classified as held for sale.
NZD $mHeld for sale
Pro Forma
Adjustments
Mainland Group
Historical Pro
Forma
Total borrowings (including lease liabilities)1041105
Add: Bank overdraft-22
Less: Cash and cash equivalents(94)(7)(101)
Add: Borrowings attributable to disposal groups held for sale---
Less: Cash and cash equivalents attributable to disposal groups held for
sale
---
Add: Cash adjustment of 25% for cash held by subsidiaries---
Less: Derivatives used to manage changes in hedged risks on debt
instruments
---
Adjusted net debt10(4)6
Equity excluding hedge reserves2,846(73)2,773
Total capital2,856(77)2,779

Fonterra - 2025 Special Meeting and Explanatory Notes31
NZD $mTotal Group
Pro Forma
Adjustments
Fonterra Historical
Pro Forma
Adjusted net debt2,620(6)2,614
Less: Cash adjustment(49)-(49)
Add: Cash and cash equivalents held by subsidiaries for operational
purposes
161(74)87
Add: Equity excluding hedge reserves8,327(2,773)5,554
Less: Net deferred tax(79)(77)(156)
Capital employed10,9808,050
Impact of seasonal variation in capital employed1,3681,297
Average capital employed (13 month rolling average)12,3489,347
Operating profit (EBIT)1,732(260)1,472
Normalisation adjustments106(106)-
Normalised operating profit (EBIT)1,838(366)1,472
Add: Finance income on long-term advances8-8
Less: Notional tax charge(49 8)98(4 0 0)
Normalised operating profit (EBIT) including finance income on
long-term advances less notional tax charge
1,3481,080
Return on capital10.9%11.6%
Fonterra historical pro forma average capital employed and return on capital
As at 31 July 2025
The Fonterra reported average capital employed and return on capital has been extracted from the Fonterra Group financial statements
as at 31 July 2025.
The Fonterra historical pro forma average capital employed calculation extracts total Fonterra Group assets and liabilities from the
Fonterra Group consolidated financial statements as at 31 July 2025 and deducts held for sale balances (excluding $27 million and
$5 million of unrelated assets and liabilities). Pro forma adjustments were made to:
• reclassify Mainland Group’s trade balances with Fonterra at 31 July 2025 (sourced from Fonterra’s accounting records), which will
become external balances following the Transaction; and
• reflect changes to the Transaction perimeter not classified as held for sale.
The Fonterra historical pro forma return on capital has been calculated using total Fonterra Group operating profit (EBIT). Pro forma
adjustments were made to:
• exclude operating profit (EBIT) in relation to discontinued operations;
• exclude transaction costs directly related to the Transaction as at that date;
• remove the effect of Fonterra’s existing transfer pricing arrangements related to Mainland Group that will cease post-divestment;
• incorporate the impact of LTSAs; and
• reflect changes to the Transaction perimeter not presented in discontinued operations nor as held for sale.

Fonterra - 2025 Special Meeting and Explanatory Notes32
Mainland Group historical pro forma average capital employed and return on capital
As at 31 July 2025
The Mainland Group historical pro forma average capital employed calculation extracts held for sale balances (excluding $27 million and
$5 million of unrelated assets and liabilities). Pro forma adjustments were made to:
• reclassify Mainland Group’s trade balances with Fonterra at 31 July 2025 (sourced from Fonterra’s accounting records), which will
become external balances following the Transaction; and
• reflect changes to the Transaction perimeter not presented in discontinued operations nor as held for sale.
The Mainland Group historical pro forma return on capital has been calculated using operating profit (EBIT) for discontinued operations,
disclosed in Note 2(b) to the Fonterra Group financial statements for the year ended 31 July 2025. Pro forma adjustments were made to:
• exclude the Soprole profit after tax of $8 million;
• exclude transaction costs directly related to the Transaction;
• remove the effect of Fonterra’s existing transfer pricing arrangements related to Mainland Group that will cease post-divestment;
• incorporate the impact of LTSAs; and
• reflect changes to the Transaction perimeter not presented in discontinued operations nor as held for sale.
NZD $mHeld for sale
Pro Forma
Adjustments
Mainland Group
Historical Pro
Forma
Adjusted net debt10(4)6
Less: Cash adjustment---
Add: Cash and cash equivalents held by subsidiaries for operational
purposes
67774
Add: Equity excluding hedge reserves2,846(73)2,773
Less: Net deferred tax77-77
Capital employed3,0002,930
Impact of seasonal variation in capital employed7171
Average capital employed (13 month rolling average)3,0713,001
Operating profit (EBIT)17280252
Normalisation adjustments106106
Normalised operating profit (EBIT)172186358
Add: Finance income on long-term advances--
-
Less: Notional tax charge(45)(4 8)(93)
Normalised operating profit (EBIT) including finance income on
long-term advances less notional tax charge
265
Return on capital8.8%

Fonterra - 2025 Special Meeting and Explanatory Notes33
Appendix B
Independent Assurance Practitioner’s Report to the
Directors of Fonterra Co-operative Group Limited
(“Fonterra”) on the Compilation of Pro Forma Financial
Information included at Appendix A in the Notice of
Meeting (“Pro forma financial information”)
Opinion
In our opinion, the Pro forma financial information has been compiled, in all material respects, on the basis of the applicable criteria.
Information subject to assurance
We have completed our assurance engagement to report on the compilation of Pro forma financial information of Fonterra by
Management. The Pro forma financial information of Fonterra and its subsidiaries (“Fonterra Group”) consists of:
• the pro forma net asset statement as at 31 July 2025;
• the pro forma income statement for the years ended 31 July 2024 and 31 July 2025; and
• related notes.
The applicable criteria on the basis of which Management have compiled the Pro forma financial information are described in Appendix A
of the Notice of Meeting.
The Pro forma financial information has been compiled by Management to illustrate the impact of the transaction set out in Section F:
Fonterra Going Forward of Part Two of the Notice of Meeting on Fonterra Group’s financial position as at 31 July 2025 and its financial
performance for the periods ended 31 July 2024 and 31 July 2025 as if the transaction had taken place prior to the start of the year ended
31 July 2024. As part of this process, information about Fonterra Group’s financial position and financial performance has been extracted
by Management from Fonterra Group’s financial statements, on which an audit has been published.
Standards we followed
We conducted our assurance engagement in accordance with International Standard on Assurance Engagements (New Zealand) 3420
Assurance Engagements to Report on the Compilation of Pro Forma Financial Information Included in a Prospectus (‘SAE 3420’) issued
by the New Zealand Auditing and Assurance Standards Board. This standard requires that the assurance practitioner plan and perform
procedures to obtain reasonable assurance about whether Management have compiled, in all material respects, the Pro forma financial
information on the basis of the applicable criteria.
Management’s responsibility for the Pro forma financial information
Management are responsible for compiling the Pro formal financial information on the basis of the applicable criteria.
Our responsibility
Our responsibility is to express an opinion about whether the Pro forma financial information has been compiled, in all material respects,
by Management on the basis of the applicable criteria.
© 2025 KPMG, a New Zealand partnership and a member firm of the KPMG global organisation of independent member firms
affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved.
Document classification: KPMG Confidential

Fonterra - 2025 Special Meeting and Explanatory Notes34
For purposes of this engagement, we are not responsible for updating or reissuing any reports or opinions on any historical financial
information used in compiling the Pro forma financial information, nor have we, in the course of this engagement, performed an audit or
review of the financial information used in compiling the pro forma financial information.
The purpose of the Pro forma financial information included in the Notice of Meeting is solely to illustrate the impact of a significant event
or transaction on unadjusted financial information of the entity as if the event had occurred or the transaction had been undertaken at
an earlier date selected for purposes of the illustration. Accordingly, we do not provide any assurance that the actual outcome, had the
transaction taken place prior to the start of the year ended 31 July 2024, would have been as presented.
A reasonable assurance engagement to report on whether the Pro forma financial information has been compiled, in all material respects,
on the basis of the applicable criteria involves performing procedures to assess whether the applicable criteria used by Management in the
compilation of the Pro forma financial information provide a reasonable basis for presenting the significant effects directly attributable to
the event or transaction, and to obtain sufficient appropriate evidence about whether:
• The related pro forma adjustments give appropriate effect to those criteria; and
• The Pro forma financial information reflects the proper application of those adjustments to the unadjusted financial information.
The procedures selected depend on the assurance practitioner’s judgement, having regard to the assurance practitioner’s understanding
of the nature of Fonterra Group, the event or transaction in respect of which the Pro forma financial information has been compiled, and
other relevant engagement circumstances.
The engagement also involves evaluating the overall presentation of the Pro forma financial information.
We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Use of this assurance report
Our report is made solely to the Directors of Fonterra for inclusion in the Notice of Meeting. We disclaim any assumption of responsibility
for any reliance on this report or on the Pro forma financial information to which this report relates for any purpose other than the purpose
for which it was prepared. This report should be read in conjunction with the Notice of Meeting.
However, we take no responsibility for, nor do we report on, any part of the Notice of Meeting not specifically mentioned in this report.
To the fullest extent permitted by law, none of KPMG, any entities directly or indirectly controlled by KPMG, or any of their respective
members or employees accept or assume any responsibility and deny all liability to anyone other than the Directors of Fonterra for our
work, for this independent assurance report, and/or for the opinions or conclusions we have reached.
Our opinion is not modified in respect of this matter.
Our independence and quality control
We have complied with the independence and other ethical requirements of Professional and Ethical Standard 1 International Code of
Ethics for Assurance Practitioners (including International Independence Standards) (New Zealand) (“PES 1”) issued by the New Zealand
Auditing and Assurance Standards Board, which is founded on fundamental principles of integrity, objectivity, professional competence
and due care, confidentiality and professional behaviour.
The firm applies Professional and Ethical Standard 3 Quality Management for Firms that Perform Audits or Reviews of Financial
Statements, or Other Assurance or Related Services Engagements (“PES 3”), which requires the firm to design, implement and operate
a system of quality control including policies or procedures regarding compliance with ethical requirements, professional standards and
applicable legal and regulatory requirements.
KPMG does not have any interest in the outcome of the proposed Transaction, other than the preparation of this independent assurance
report and related due diligence procedures, for which normal professional fees will be received.
Our firm has also provided other services to the Fonterra Group in relation to the audit of the Fonterra Group’s financial statements,
climate related assurance, farmgate milk price assurance, agreed upon procedures and vendor due diligence in relation to the divestment
of the Consumer and associated businesses. We also performed an audit of the Mainland Group combined and carve-out financial
statements in relation to the divestment. Subject to certain restrictions, partners and employees of our firm may also deal with the Fonterra
Group on normal terms within the ordinary course of trading activities of the business of the Fonterra Group. These matters have not
impaired our independence as assurance provider to the Fonterra Group. The firm has no other relationship with, or interest in, the
Fonterra Group.
Yours faithfully,
KPMG
KPMG
Auckland
28 September 2025

If undelivered please return to:
The Returning Officer
Special Meeting 2025
PO Box 3138
Christchurch 8140
Free phone 0800 666 034fonterra.com

---

YOU CAN VOTE IN ONE OF THE FOLLOWING WAYS:
HOW TO COMPLETE THE PROXY PAPER AND APPOINT A PROXY
1. Appoint a proxy: Provide the full name and address of your chosen proxy in the space provided for “Primary Proxy” in the box
labelled “Appointment of Proxy” in the Special Meeting Proxy Paper. A proxy need not be a shareholder.
The Chair of the Meeting is willing to act as your primary proxy. If you wish to appoint the Chair of the Meeting you can simply
write “Chair”.
Unless you choose the Chair of the Meeting, it is recommended that you appoint an alternate proxy as well, in case your
primary proxy is unable to attend on the day of the Special Meeting. Please provide the full name and address of your alternate
proxy in the space labelled “Alternate Proxy” in the box labelled “Appointment of Proxy”.
Where a shareholder does not name a person as their proxy but otherwise completes the Proxy Paper in full, or where a
shareholder’s named proxy (and any alternate, if one has been appointed) does not attend the meeting, the Chair of the
meeting will act as that shareholder’s proxy and will vote in accordance with their express direction. The Chair intends to vote
any discretionary proxies, for which they have authority to vote, in favour of the resolution.
Please note: You do NOT need to appoint an alternate proxy if the Chair of the Meeting is your primary proxy.
2. Instruct your proxy how to vote: You can instruct your proxy how to vote by placing a tick in either the “For” or “Against”
box in the box labelled “Voting Instructions”. If you wish for your proxy to vote as she/he determines place a tick in the “Proxy
Discretion” box. Your proxy CANNOT change the direction of your vote if you instruct them how to vote in this manner. If you
do not expressly direct your proxy on how to vote by placing a tick a box, then your proxy cannot vote.
3. Sign the form: Each shareholder who wishes to appoint a proxy must sign the “Special Meeting Proxy Paper”:
• Individuals/sole proprietors: The shareholder must sign the Special Meeting Proxy Paper.
• Companies: A duly authorised representative of the company must sign the Special Meeting Proxy Paper.
• Joint shareholders (including trusts, partnerships and estates): It is your responsibility to ensure that the person(s) signing
the Special Meeting Proxy Paper is/are authorised to sign on behalf of, and bind, all joint holders.
• Attorneys: If the Special Meeting Proxy Paper is signed under a power of attorney, it must be accompanied by a signed
certificate of non-revocation of the power of attorney. The power of attorney under which the Special Meeting Proxy Paper
is signed must be sent with the Special Meeting Proxy Paper if the power of attorney has not been previously produced to
Fonterra.
4. Return the form: Return the Special Meeting Proxy Paper as soon as possible. It must be received by the Returning Officer no
later than 10.30am on Tuesday, 28 October 2025.
• Mail by separating, folding and inserting the Special Meeting Proxy Paper into the freepost envelope provided.
We recommend that you post your Special Meeting Proxy Paper by no later than Wednesday 22 October 2025 so that it is
received by the Returning Officer before the close of appointment.
HOW TO APPOINT A CORPORATE REPRESENTATIVE
In the case of a shareholder that is a company or other body corporate, a representative can be appointed to attend the Special
Meeting by completing the Special Meeting Proxy Paper. In this form, proxy can mean proxy or representative appointed for a
company or other body corporate.
REVOKING YOUR APPOINTMENT
A shareholder can still attend, even if they have appointed a proxy (although shareholders attending online will not be able to
vote if a proxy has been appointed). If you change your mind on the appointment of a proxy or representative, you can revoke the
appointment by written notice to Fonterra. Such notice must be received at Fonterra’s head office - Fonterra Special Meeting,
Fonterra Co-operative Group Limited, Private Bag 92032, Auckland 1142 no later than 10.30am on Tuesday, 28 October 2025.
Fonterra Special Meeting 2025
Combined Special Meeting
Voting/Proxy Paper
Fonterra Special Meeting 2025
Special Meeting
Proxy Paper Information
OPTION 1: POSTAL VOTING (INCLUDING ELECTRONICALLY) –
CLOSES AT 10.30AM ON TUESDAY, 28 OCTOBER 2025
Either:
(a) Post the completed “Special Meeting Voting Paper” to the Returning Officer in the freepost reply envelope provided.
To ensure your Special Meeting Voting Paper reaches the Returning Officer before the close of voting please post no
later than Tuesday 28 October 2025.
Or
(b) Electronically via the Farm Source website at: www.nzfarmsource.co.nz
• Login using your Farm Source login and password.
• Follow the voting links from the homepage.
• Enter your Personal Identification Number (PIN) and password – see below.
IMPORTANT: By entering the PIN and password you warrant and undertake that you are authorised to exercise the vote of
this shareholder.
After voting online, you do not need to submit this Special Meeting Voting Paper and it can be destroyed.
PINPassword
OR
OPTION 2: AT THE MEETING –
FROM 10.30AM ON THURSDAY, 30 OCTOBER 2025
If you plan to attend the meeting online, please vote via the virtual meeting platform:
https://fonterra.brandlive.com/Fonterra-Special-Meeting/en
• Login using name, email address and supply number(s)
• Follow the voting links from the homepage.
• Enter your PIN and password – see above.
OR
OPTION 3: BY PROXY –
RECEIVED BY 10.30AM ON TUESDAY, 28 OCTOBER 2025
Appoint a person to attend the Special Meeting and vote on your behalf. A proxy need not be a shareholder.
Please only use one of these voting methods
PROXY APPOINTMENT CLOSES AT:
10.30AM ON TUESDAY, 28 OCTOBER 2025
POSTAL VOTING (INCLUDING ELECTRONICALLY) CLOSES AT:
10.30AM ON TUESDAY, 28 OCTOBER 2025
For enquiries phone the ELECTION HELPLINE: 0800 666 034
The Special Meeting of Shareholders to consider and vote on the sale of Mainland Group Holdings Limited will be held
online at: https://fonterra.brandlive.com/Fonterra-Special-Meeting/en at 10.30am on Thursday, 30 October 2025
SAMPLESAMPLE

Indicate your vote with a tick
FORAGAINST
1
Resolution: That the sale of all the shares in Mainland Group Holdings Limited
pursuant to the sale and purchase agreement with B.S.A. SAS dated
22 August 2025 as described in the Explanatory Notes, is approved,
including for the purposes of NZX Listing Rule 5.1.1(b).
C: Voting Instructions
Complete this section to instruct your proxy holder how to vote.
FORAGAINST
PROXY
DISCRETION
1
Resolution: That the sale of all the shares in Mainland Group Holdings
Limited pursuant to the sale and purchase agreement
with B.S.A. SAS dated 22 August 2025 as described in the
Explanatory Notes, is approved , including for the purposes of
NZX Listing Rule 5.1.1(b).
Use this paper to vote by post. If voting online by way of electronic postal vote, refer to
instructions on reverse.
The Special Meeting of Shareholders to consider and vote on the sale of Mainland Group Holdings Limited will be held
online at: https://fonterra.brandlive.com/Fonterra-Special-Meeting/en at 10.30am on Thursday, 30 October 2025
Supply No.:
Details of person completing this Special Meeting Voting Paper:
First Name:
Surname:
Signature:
Fonterra Special Meeting 2025
Special Meeting Voting Paper
Fonterra Special Meeting 2025
Special Meeting Proxy Paper
Only use this Special Meeting Proxy Paper if you do not plan to attend the meeting but wish to be represented by a
proxy holder at the meeting. This paper can also be used by a shareholder that is a company or other body corporate
to appoint a representative.
There are no voting restrictions on the resolution to be considered at the meeting.
A: Shareholder Details
Name:
Supply Number:
Party Number:
B: Appointment of Proxy
If you wish to appoint someone as your proxy, insert their full name and address below. The Chair of the meeting is willing
to act as a proxy.
Primary Proxy: I/We appoint:
Full name of your proxy:
Full address of your proxy:
as my/our proxy to vote for me/us on my/our behalf at the Special Meeting of Shareholders to be held at 10.30am on
Thursday, 30 October 2025 and at any adjournment of that Special Meeting.
Alternate Proxy: You do not need to appoint an alternate proxy but it is recommended that you do so, unless you are
appointing the Chair of the meeting as proxy. The Chair of the meeting is willing to act as an alternate proxy. If the person I/
we have appointed is unable to be my/our proxy then I/we appoint:
Full name of your alternate proxy:
Full address of your alternate proxy:
Signature(s) of shareholder(s) named in Section A (Please see signing instructions on reverse.)
By signing this form, I/we warrant and undertake that I/we are authorised to sign on behalf of, and bind, the shareholder(s)
named in Section A.
Name of shareholder:Signature:
Full name and title of signatory:Date:
Name of shareholder:Signature:
Full name and title of signatory:Date:
Name of shareholder:Signature:
Full name and title of signatory:Date:
If you are appointing a proxy, return this paper as soon as possible. It must be received by the Returning Officer no later than
10.30am on Tuesday, 28 October 2025.
Mail by separating, folding and inserting the Special Meeting Proxy Paper into the freepost envelope provided.
SAMPLESAMPLE

---

Chairman’s Email

28 September 2025


Subject: Update from the Chairman – Notice of Special Meeting

Kia ora,

As part of our annual results announcement on Thursday, we confirmed that the virtual
Special Meeting on the proposed sale of our global Consumer and associated businesses
will be held on Thursday 30 October.

The Notice of Meeting for the Special Meeting is now available online here.

Please note that voting will not open until Tuesday 7 October. Before voting opens,
shareholders who are entitled to vote will be sent further instructions on how to vote by the
Returning Officer – electionz.com (iro@electionz.com). This will include a unique Pin and
Passcode.

To support shareholder decision making, the Fonterra Co-operative Council has
commissioned an independent report analysing the divestment proposal. The Co-operative
Council will be distributing this report today by email and it will be available on the Farm
Source website.

I’d encourage you to read through these documents when you get the chance.

The proposed consumer sale to Lactalis for $4.22 billion will also be a key focus of
discussion during the annual farmer roadshow meetings happening next week.

Further details about the divestment and vote process are available at
www.nzfarmsource.co.nz/haveyoursay.

Look forward to seeing as many of you as possible at the roadshow meetings next week.

Regards,

Peter