Hong Kong-listed infant formula firm Biostime International Holdings is to invest in French dairy co-op Isigny Sainte Mere as the companies plan to set up a production facility in northern France.
Biostime will buy a 20% stake in Isigny, which alongside its branded cheese and butter on sale in Europe and North America, supplies infant formula, largely to Asia. Biostime is among the companies Isigny supplies infant formula to.
The HK$24.5m (US$3.2m) Biostime will pay for the shares in Isigny will fund an infant formula production and packaging facility at the co-op’s site in Lower Normandy to supply the Hong Kong-listed firm
The facility will supply 15,000 tonnes of infant formula powder to Biostime in 2015 and 18,000 a year from 2016, the Hong Kong-listed firm said. The manufacturing deal will last for 15 years. The two sides will also work on R&D.
“The directors consider that the proposed project with ISM can further enhance and secure the supply of premium quality infant formula products while strengthening the partnership through participation in the share capital of ISM and enhancing common R&D projects,” Biostime said.
Isigny officials could not be reached for immediate comment.