THE world’s largest dairy exporter Fonterra will cut its 18.8 percent stake in Chinese infant formula maker Beingmate Baby & Child Food by selling shares on the stock market after failing to find a buyer for the poorly performing asset.

Fonterra said in a statement yesterday it will sell down its Beingmate stake on the Shenzhen Stock Exchange. It did not specify how much of the stake it will sell.

New Zealand’s Fonterra booked a hefty writedown on its Beingmate stake last year. Fonterra CEO Miles Hurrell said its relationship with Beingmate had been “disappointing,” and the plan to trim its stake came after a strategic review.

“We have talked to a number of parties regarding the potential sale of our entire stake in Beingmate, but so far have been unsuccessful in finding a buyer,” Hurrell said in the statement.

Representatives of Beingmate did not immediately respond to a request for comment.

Fonterra had acquired a stake in Beingmate for about NZ$750 million (US$490.50 million) in 2015, seeking to tap into the lucrative branded dairy industry in China.

However, Beingmate’s stock began a sharp downturn thereafter. Since the end of 2015, its shares have tumbled 67 percent, devaluing Fonterra’s investment and forcing it to book a NZ$405 million writedown for its holding last year.

Fonterra’s 18.8 percent holding in Beingmate is currently worth about NZ$206 million, as of Beingmate’s last closing price Tuesday.

“It’s clearly a disappointing announcement, Fonterra would have gotten a better price for sale of the entire 18.8 percent stake in Beingmate,” said Jeremy Sullivan, investment adviser at New Zealand-based Hamilton Hindin Greene.

Sullivan said the move did not come as a surprise to shareholders, as the company had been revealing its troubles with Beingmate for some time and the news is largely baked into its current share price. (SD-Agencies)