China Herald: Fonterra

The 2013 Fonterra milk scandal has not diminished the aspirations of the New Zealand firm to play a role in China´s dairy industry. This week Fonterra bought 20% stake in Beingmate, a smart move, says retail analyst Ben Cavender to Reuters.

Reuters:

"Beingmate have pretty good distribution and are definitely known in the market, so this is probably going to help Fonterra," said Ben Cavender, a Shanghai-based principal at China Market Research Group.

"It could be a big money maker for them but they are also coming into a very competitive market now with consumers that are much more savvy than they were three, four years ago."

More at Reuters.

Ben Cavender is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch.

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Ben Cavender

The Bright Food Group has been looking for international acquisitions to accommodate Chinese hunger, and has recently started talks with Israel-based Tnuva Foods. After erstwhile favorite New Zealand's Fonterra ran into problems, Europe and other countries have come on their agenda, explains business analyst Ben Cavender in the Wall Street Journal.

The Wall Street Journal:

Industry watchers say a Tnuva deal would be a big one if it happens. British private equity firm Apax Partners LLP, holds 56% of Tnuva, which it bought in 2008 with investment partner Mivtach Shamir. Combined, they purchased 77% of the company for just over $1 billion in 2008, according to Apax.

Tnuva distributes its own-branded hard and soft cheeses. A deal could see more Israeli products on Chinese grocery store shelves and vice versa. Tnuva products could help Bright Food enhance its premium portfolio, said Ben Cavender, a senior analyst at China Market Research Group.

Also on the hunt for food manufacturing acquisition targets is Shuanghui International Holdings Ltd., China’s largest meat processor, which struck a surprise $4.7 billion agreement in May to acquire U.S. pork giant Smithfield Foods Inc. The deal, if approved, would help Shuanghui improve its production capacity as well as packing and food safety techniques back in China.

Cofco Corp., China’s largest state-owned grain trader, is also seeking acquisitions and investment opportunities to expand its consumer brands, executives have said.

Mr. Cavender said that Chinese food companies are increasingly looking to Europe and previously unexplored countries, such as Israel, for dairy deals or imports. China has typically turned to New Zealand for dairy products, but companies within the country are seeking alternatives after a recent contamination scare involving New Zealand’s Fonterra Cooperative Group Ltd., Mr. Cavender said.

More in The Wall Street Journal.

Ben Cavender is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.

China Weekly Hangout

China's internet companies are another industry looking for international expansion. The +China Weekly Hangout on Thursday 5 September will discuss the latest deals with +Tech in Asia editor +Steven Millward, and a range of other panelists. You can read our announcement here, or register for the event here.

China's food industry is desperately looking for foreign cooperation, as scandal after scandal unfolds. On March 21 the +China Weekly Hangout discussed with sustainability expert +Richard Brubaker, +Andrew Hupert and +Chris Brown food security and how the ongoing problems will lead to massive food inflation. In the end we (both in China and outside) will have to pay the price for safe food. Moderation by +Fons Tuinstra of the China Speakers Bureau.