The combination of Fonterra, the global dairy giant, and Beingmate, the former leader of Chinas dairy industry, has now reached a watershed because of Beingmate’s successive losses. Beingmate recently announced that the major shareholder Beingmate Group signed a share transfer agreement on December 5, 2018 to reduce some of its shares through the method of agreement transfer, while Fonterra, Beingmates second shareholder, said that "the investment in Beingmate is also under review".

On December 6, Beingmate announced that its controlling shareholder, Beingmate Group, had signed an equity transfer agreement to transfer 5.09% of Beingmates equity to Changhong Investment Fund Partnership of Great Wall Guorong. After the transfer, Beingmate Group and its actual controller Xie Hong held 29.13% and Changhong Fund 5.09%,  becoming the third largest shareholder after Beingmate Group and Fonterra.

On the same day, local media in New Zealand said Fonterra was breaking ties with Chinese partner Beingmate. The media also reported that Fonterra Chairman John Wilson said he had initiated a review of Fonterras assets and operations and identified three assets that could be sold, including Beingmate, a dairy company in China. In response, Fonterras responsible person said "We are conducting a strategic review of all investments to ensure that they meet our strategic objectives. Our investment in Beingmate is also under review, including our joint venture with Darren Factory.

Zhu Danpeng, an analyst of Chinas food industry, pointed out that Fonterra invested in Chinas dairy industry to see the dividends of Chinas consumption structure, consumption upgrading and population, but Fonterra was only in the investment side and did not participate in the actual operation. From the capital-side perspective, Fonterras re-examination of the prospects for Beingmate’s development is also a normal business logic.
On December 6, Beingmates share price, reduced to * ST, closed at 5.19 yuan. Its not just Great Wall Guorong, which has just become the third largest shareholder, but also Fonterra, the second largest shareholder of Beingmate, which has invested in Beingmate for three years, and its floating losses have intensified.

In 2015, Fonterra made an offer of $3.464 billion to buy 192 million shares of Beingmate at a price of 18 yuan per share, making it the second largest shareholder of the company. High-premium acquisition has brought a huge pit. Beingmates performance has declined sharply for many years. Its stock price has fallen sharply. based on the closing price of Beingmates 523 yuan on Dec. 10, Fonterras stock market value is only 104 million yuan, with a floating loss of 2.466 billion yuan.

Fonterra is under tremendous pressure because of its huge loss in investment in Beimate. In FY2018, Fonterra posted a net loss of NZ$196 million after tax, one of the major reasons is the NZ$439 million impairment on investment in Beingmate