Fosun invests $325m in Beijing Sanyuan Foods

According to a regulatory filing, Fosun will subscribe 306 million ordinary shares at RMB6.53 apiece in a private placement offered by Sanyuan. It will invest via Shanghai Pingrun Investment Management and Shanghai Fosun Chuanghong Equity Investment Fund Partnership - Chuanghong Fund.

Shanghai-listed Sanyuan primarily focuses on production, processing and sale of dairy products. In a seperate filing, the company said it will raise an additional RMB$2 billion from Beijing Capital Agribusiness Group - also known as Sunlon - a food conglomerate created by the Beijing government in 2009.

Fosun said it is optimistic about the infant formula and milk powder industry as well as the future growth potential of Sanyuan.

Fosun's renminbi-denominated Chonghong Fund was launched in July 2011, with a corpus of RMB1.5 billion. LPs include private and public domestic companies.

China's dairy sector has long been a favorite of private equity. One recent transaction saw RRJ Capital commit RMB1.5 billion for a 45% stake in a dairy farming joint venture with Shanghai-listed Bright Dairy & Food, a subsidiary of Chinese conglomerate Bright Food Group.

In October, Affinity Equity Partners invested $123 million in a joint venture partnership Sunlon.

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• Topics
• Greater China
• PIPEs
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• China
• Fosun Group
• Consumer