Chinese infant-formula firm Shengyuan International Group, trading as Synutra, has acquired a local competitor, Harbin Alfbeta.

Alfbeta, based in the city of Harbin in China’s northern Heilongjiang province, is the fourth baby powder company acquired by Synutra within a year. Its facilities will immediately start producing the Shengyuan Aiyiduoqi brand.

Synutra controls six Chinese companies developing, producing, packaging and marketing nutritional milk powder. It has factories in the Chinese city of Qingdao in the southern Shandong province, as well as in Brittany in northern France. The latter is now being operated by French dairy cooperative Sodiaal under an agreement that will see Synutra continue to oversee packaging.

Synutra products mainly include formula milk powder for infants, pregnant and lactating women. In recent years, Synutra has expanded its product line, successfully building its Youbo brand, consisting of Youbo milk powder for pregnant women and growth milk powder for infants and older babies.

Alfbeta claimed the takeover reflected Chinese government policy supporting consolidation and reorganisation in the infant formula sector – outlined in a May 2019 policy entitled ‘Opinions on Deepening Reform and Strengthening Food Safety Work’.

Zhang Liang, chairman and CEO of Synutra, told Chinese media that while the country’s birth rate has been falling, infant dairy product sales potential is strong given demand in China for quality products.

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By GlobalData