Photo: VCG
PepsiCo Inc. has agreed to buy a nearly 26% stake in a Chinese health-food giant as the American conglomerate seeks to tap into rising middle-class affluence in the world’s largest food and beverage market.
PepsiCo will invest HK$1.02 billion ($131 million) to acquire 566.5 million shares, or 25.8%, of Shenzhen-based Natural Food International Holding Ltd., becoming the Chinese company’s second-largest shareholder, according to Natural Food’s filing to the Hong Kong Stock Exchange on Friday. That price represents a premium of 6.1% on Natural Food’s average share price over the last 30 trading days.
The deal will accelerate PepsiCo’s development in China by cooperating with Natural Food in the fields of production, distribution, and promotion, said PepsiCo in a statement.
Natural Food, which largely focuses on grain-based nutrition powders, is China’s second-largest health food producer by sales, trailing behind Nanfang Black Sesame Group Co. Ltd., according to research firm Frost & Sullivan.
Contact reporter Tang Ziyi (ziyitang@caixin.com)
Related: How Coca-Cola Put Its Own Health First
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