Blog: The challenge in China for Weetabix
Dean Best | 5 November 2012
Chinese food group Bright Food kicked off this morning (5 November) with confirmation of its acquisition of 60% of UK cereal firm Weetabix, a deal first announced in May.
Bright Food chairman Zongnan Wang said the agreement was a "landmark acquisition" for the Chinese company.
"Bright Food will increase the level of investment in Weetabix brands and product innovation to facilitate its development in the international markets. In particular, Bright Food is committed to leveraging its resources and extensive experience across all aspects of the food industry to underpin Weetabix’s expansion in Asia, in particular China," he said. "We are confident that with support from Bright Food, Weetabix's sales in China will outperform the growth of the Chinese cereal market."
Weetabix's previous owner, private-equity firm Lion Capital, was equally upbeat, with partner Lyndon Lea insisted he was "excited" about partnering with Bright Food "in extending the track record of growth that Weetabix has posted over the years".
Lion Capital and Weetabix's management will own the remaining 40% of the company. And while Weetabix CEO Giles Turrell was confident about the company's prospects, he hinted at the challenge that could lie ahead in China when he talked of developing "additional products which cater for the Chinese market".
As just-food reported when the deal was first announced in May, it remains early days for breakfast cereal in China. Ready-to-eat cereals, consumed with cold milk, have not been widely accepted by Chinese consumers.
Could Weetabix's Ready Brek brand, then, be the one to push and build on in China?
Food is a small part of the portfolio at PZ Cussons, the UK-based FMCG group better known for brands including Imperial Leather soap and Charles Worthington shampoo. However, the company is a major ol...
Cargill's move to buy Archer Daniels Midland's chocolate business has cleared its last regulatory hurdle after clearance from the European Commission. But Brussels has asked Cargill to offload part of...
- Campbell Soup Co.'s M&A plans should avoid fresh
- Mead Johnson wrestles "irrational" Chinese market
- On the money: Unilever aims to get food growing
- 10 things to learn: Campbell's plans for growth
- Briefing: How is gluten-free faring in Europe?
- Hain Celestial buys plant-based food firm Mona
- Post, TreeHouse "in talks over ConAgra own-label"
- Lactalis surpasses Danone on dairy league table
- Nestle replaces India MD after Maggi scandal
- Greencore sales up on UK, US growth