Meituan-Dianping invests $87m in China food supply chain player
Shenzhen-based agricultural products distributor Wangjiahuan has raised RMB600 million ($87 million) in Series B funding led by Meituan-Dianping. Existing backer Hidden Hill Capital - a PE firm established by warehouse operator GLP - also took part.
Meituan-Dianping, China’s largest online-to-offline (O2O) services platform, relies on B2C food delivery for a significant amount of its revenue. Backing Wangjiahuan appears to represent an expansion into the upstream B2B segment. Zhou Yu, a senior investment director at the company, said in a statement that Wangjiahuan is China's leading distributor of group meals with a huge first-mover advantage in terms of bidding, supply chain, and funding.
Jun Gao, the founder and chairman of Wangjiahuan, added that collaboration between the two companies will extend from procurement to delivery to vehicle management.
Founded in 1995, Wangjiahuan has interests spanning crop cultivation, agricultural product processing, distribution, and catering services. It claims to have an agricultural production base of more than 130 million square meters. The company also has distribution contracts with over 200 recognized local food brands, serving 20,000 large-scale corporation clients nationwide.
China’s food industry generated revenue of RMB4.67 trillion in 2019, up 9.4% year on year, according to the China Hospitality Association. Food services for non-commercial businesses such as school and company canteens contributed RMB1.2 trillion.
Hidden Hill Capital invested RMB400 million ($58 million) in Wangjiahuan in 2018.
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