China Huishan Dairy Holdings Co. Ltd. (06863.HK) is teaming up with Dutch dairy giant Royal FrieslandCampina N.V. in a joint venture designed to tap demand for generic baby formula, the Hong Kong Economic Journal reported Friday, citing a stock exchange filing by the mainland milk powder producer.
FrieslandCampina, maker of the popular Friso formula line, generated 11.4 billion euro (US$15.78 billion) in sales last year across Europe, Asia and Africa, making it one of the five biggest players in the world.
The JV company and FrieslandCampina will jointly own a plant in Liaoning province and be responsible for all sales and marketing. Huishan will supply raw milk to the plant for dairy products to be sold on the mainland under a new brand name aimed at demarcating the venture from the two partners’ existing formula businesses.
The mainland milk maker listed in September and major shareholders have twice dumped shares since the end of the post-debut six-month lock-up period.
Swiss food firm Hero A.G. cashed in HK$1.1 billion (US$141.9 million) by selling 520 million shares at HK$2.21 apiece. Cornerstone investor Cheng Yu-tung, founder of New World Development Co. Ltd. (00017.HK), also sold 259 million shares last month, cutting his holding to 7.18 percent from 8.98 percent to pocket about HK$474 million.
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