Private equity firm Affinity Equity Partners has acquired a 40% stake in the largest dairy supplier to Beijing for $123 million, according to a person familiar with the matter.
The deal with Beijing Capital Agribusiness Group CAG comes amid increasing demand for high-quality milk products as China’s middle class expands and demands creamier, fresher milk but, above all, safe food following a national tainted-milk scandal in 2008.
Most of China’s milk is still produced by small-scale farmers that sell to myriad middlemen before reaching consumers meaning quality control is tricky to monitor.
Foreign firms have benefited from Chinese consumers’ flight to big name brands....
¬ Haymarket Media Limited. All rights reserved.
