Nestlé is to leave the dairy sector in Ecuador through a deal with Latin American food company Grupo Gloria.

The transaction will see Nestlé sell a factory and distribution centre located in the city of Cayambe, north of the capital, Quito.

Grupo Gloria will buy the local brands La Vaquita, Yogu Yogu, Natura, Cereavena and Huesitos.

The agreement also covers the licensing of more international brands La Lechera and Svelty.

The deal remains subject to the approval of Ecuador’s competition watchdog.

In February, Nestlé announced plans to close a dairy plant in Nicaragua due to “current global dynamics for efficient and productive operations”.

Josué De la Maza, the executive president of Nestlé’s business in Ecuador, said the company would continue to do business in sectors including culinary products, confectionery, coffee and infant formula.

He added: “It should be noted that in 2018 we acquired Terrafertil, an Ecuadorian company that has grown throughout Latin America with a leading portfolio in the plant-based category, which strengthens our product offering to Ecuadorian consumers. We are confident that Gloria Foods will continue to develop the dairy business in Ecuador based on its regional trajectory.”

Peru-based Grupo Gloria has operations in countries including Ecuador, Bolivia, Colombia, Argentina, and Puerto Rico. It produces dairy items, plant-based milk, jam, cake, canned fish and soft drinks brands.

“With this purchase, we renew our commitment to the Ecuadorian market as a relevant player in the food sector and we enthusiastically welcome the excellent workforce and the important brands that the acquisition of the operation brings with it,” Gloria Foods president Claudio Rodríguez said.

“We are sure that this transaction will strengthen our portfolio in Latin America and will allow us to continue bringing our quality and experience to the countries where we are present.”

In 2022, Grupo Gloria bought a batch of dairy assets in Chile from New Zealand dairy giant Fonterra.