(Yicai) Dec. 3 -- Yoplait China’s owners have agreed to sell the dairy producer, which mainly makes yogurts, to a local investment firm following a post-pandemic return to profitability amid stiff local competition.

 

Tiantu Capital will sell all of its 45.22 percent of Yoplait China to Kunshan Nuoyuan Ruiyuan Management Consulting for almost CNY814 million (USD115 million), the Shenzhen-based venture capital firm announced on Dec. 1, adding that the sale will result in a CNY847,000 (USD120,000) loss.

The other sellers own a 41.74 percent stake between them, which they will sell in its entirety for CNY751 million, taking the deal to about CNY1.8 billion.

Tiantu Capital acquired Yoplait China in 2019, though the purchase price was not publicly disclosed. The firm said the sale would realize investment returns and fulfill its exit obligations for the funds it manages.

Its sale then coincided with a peak in Yoplait China’s earnings. Hit by the Covid-19 pandemic and the rise of local rivals, it lost nearly CNY200 million from 2020 to 2022. But as the chilled yogurt category picked up, the company had a CNY8.4 million profit in 2023 and CNY95.5 million last year.

The yogurt market has remained relatively weak since the pandemic, with a sharp decline in the high-end segment, and Yoplait China’s market share has also been gradually shrinking, independent dairy analyst Song Liang told Yicai.

Given the fierce competition from domestic dairies and trendy new yogurt brands, the sale of Yoplait China represents a timely exit, Song added.

Kunshan Nuoyuan Ruiyuan is partially controlled by IDG Capital, according to business information platform Qichacha. Founded in 1993, IDG invests in consumer technology, healthcare, and the wider consumer sector, with its portfolio including companies such as Three Squirrels, Xiaomi, and Pinduoduo.

The rise of Chinese consumer brands over the years has piled pressure on international players, Song said, adding that it remains to be seen how IDG will run Yoplait China.

 

Editor: Tom Litting