French dairy group Sodiaal has taken over most of an infant-formula plant in Brittany province operated by China’s Synutra.
Talks to acquire the Carhaix site began last August as Sodiaal sought to increase its presence in the Chinese baby-formula market amid reports Synutra was struggling to generate sales for its products manufactured in France for its home market. The proposed deal was part of Sodiaal’s transformation programme, Value, launched in late 2017.
Synutra will retain the blending and packaging operations and will remain a customer of the French co-op, according to a statement from Sodiaal, which will run production at the site.
About 180 workers will be transferred to Sodiaal, while around 300 will stay under Synutra’s control.
Sodiaal’s president, Damien Lacombe, told Reuters the company had planned to build a new infant-formula plant, but that will no longer be necessary with this agreement.
Lacombe said in the statement: “This acquisition is very good news for the 20,000 members of the cooperative. Production at the Carhaix plant will allow us to win several years on our development plan in a global market for highly-dynamic infant formula.”
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The Carhaix plant has a production capacity of 65,000 to 80,000 tonnes per year, compared to Sodiaal’s 30,000 tonnes, Lacombe told Reuters. The co-op will supply half of its infant-formula output to Synutra and the rest will be offered to other customers, including those in China, he said.