(Bloomberg) -- Fonterra Cooperative Group is considering an initial public offering — along with a trade sale — as it moves ahead with selling its global consumer businesses.

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The world’s biggest dairy exporter said in May it was considering turning away from branded consumer products to concentrate on making more high-value ingredients derived from New Zealand milk that it sells to other companies like Nestle SA, Mars and Coca-Cola Co. A report last week suggested it may return NZ$3 billion ($1.8 billion) to its roughly 8,300 shareholding farms if a full exit was achieved.

“We have assessed both a trade sale and IPO as attractive divestment options and will now prepare for a sale process which will pursue both options,” Fonterra Chief Executive Office Miles Hurrell said Monday in Auckland. The company “continues to target a significant capital return to be made to farmer shareholders and unit holders following the divestment,” he said.

Shares of the Fonterra Shareholders Fund, which tracks the earnings and dividends of the cooperative, rose 1.8% to NZ$5.07 and were on track for the highest close since March 2021.

The businesses, which include consumer brands such as Anchor, Anlene and Mainland as well as Fonterra Oceania and Fonterra Sri Lanka, together account for about a fifth of Fonterra’s revenue.

Hurrell said the company has received “meaningful buyer interest” in the businesses earmarked for divestment.

“We will thoroughly test the terms and value of both a trade sale and IPO with the market before seeking support from farmer shareholders for a divestment option through a vote,” he said. “A final decision on which divestment pathway to pursue will be based on several factors, including which option will result in optimal long-term value for the co-op.”

The valuation report last week from Northington Partners said the businesses may be worth as much as NZ$3.4 billion, or about NZ$2 a share, to farmer shareholders.

(Updates with stock reaction in fourth paragraph)

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