China's Taishan Beer raises $92m
CMC Capital Group has committed RMB600 million ($92 million) in funding to Chinese domestic beer brand Taishan.
The new capital will be used to grow production capacity and establish new factories for a regional expansion. The company will also make improvements to information management in its warehousing system, last-mile logistics, and standardized store replication.
Founded in 1979, Taishan Beer was acquired by Hong Kong’s Hucais Printing in 2000. The company’s annual production capacity is 400,000 tons. It is known for using deep underground water from Mount Tai in Shandong province as well as German production equipment and technology.
Recent product development includes a short shelf-life beer that emphasizes freshness by being produced and delivered on the same day. Taishan believes the rollout has opened up a new product category, while introducing logistical challenges.
In response, the company has developed a new distribution channel comprising directly-operated stores suitable for short shelf-life beer. The company now has 1,600 outlets in provinces including Shandong, Heibei, Jiangsu, and Guangdong, as well as Beijing. It has accumulated more than eight million members.
“This is the first time that Taishan Beer has openly raised external funding. We’ve become the first investor because its product strength and unique operating model fits perfectly with the new structural opportunities we see in consumption upgrades. We will use our resources to further help the company enhance its brand potential and grow into a leading enterprise in China's mid-to-high-end beer market,” said Weicai Li, a partner and COO at CMC.
Initially a specialist media investor, CMC now targets companies – based in China or with a strong China growth angle – across the media and entertainment, technology, and consumer spaces. Sub-sectors range from film and television to supply chains and logistics.
The firm closed its third US dollar-denominated fund at $950 million in early 2020, taking total assets under management past $2.5 billion.
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