(Yicai Global) Feb. 16 -- Japanese beverage giant Kirin Holdings said it is selling its entire stake in a soft drinks joint venture with China Resources to a Chinese investment fund for JPY115 billion (USD994 million).

Kirin will sell its 40 percent of China Resources Kirin Beverages, which owns the C’estbon water brand, to Plateau Consumer, the Tokyo-based company said in a statement today.

Kirin said the sale is part of its business portfolio review, but its alliance with China Resources will go on. It expects to book a gain of about CNY39 billion (USD337 million) from the sale.

Set up in 2011, the JV is a holding company of China Resources C’estbon Beverage Investment. Over the past 10 years, CR C’estbon has been expanding its business across the country, including into coffee, milk tea, energy drinks, healthy tea, and fruit juice. It had revenue of CNY10.4 billion (USD1.64 billion) in 2019.

China’s beverage market is ultra-competitive, with C’estbon competing not only against international brands such as Coke Cola and Pepsi, but also against Nongfu Spring and many milk tea names.

Kirin’s exit from the JV is probably due to the pressure faced in the beverages market, an industry analyst was cited as saying by Beijing News in January.

Editor: Peter Thomas