A joint statement of Bright Food and Lion Capital issued on Wednesday said the acquisition signals that the Chinese food company will enter both the British and global food markets through the iconic Weetabix brand.
Bright Food will take a 60 percent stake in Weetabix in a deal that values the company at 1.2 billion pounds.
The transaction will represent the largest overseas acquisition by a Chinese company in the food and beverage sector.
A press release of Lion capital said, “The purchase also support Bright Food’s strategy of buying famous international brands, developing advanced technology and taking strong competitive positions in each of its market.”
“Bright Food is committed to driving the global growth and success of the Weetabix Business, with focus on the potential in Asia and especially in China, to take advantage of the growth appetite in the country for packaged and convenient healthy foods.”
The remaining 40 percent of the shares of Weetabix will continue to be held by Lion and management.
Weetabix, based in Northamptonshire in central England, said its trademark breakfast cereal accounts for 7 percent of Britain’s cereal sales, with annual sales of 101 million pounds.
Wang Zongnan, Chairmen of Bright Food, said in the statement “as a leading business in China’s food industry, we are delighted to become the majority shareholder in Weetabix.”
The British brand is sold in 80 countries and regions, employs around 2,000 people and generates annual sales of 423 million pounds.
Other brands in the British company’s portfolio include Alpen, Ready Brek and Oatibix.
Weetabix, the second biggest cereal producer in Britain, was founded in 1932 and was family owned until 2004 when it was bought by the private equity firm Lion Capital.
The deal is subjected to regulatory and government approvals in China, although completion of the deal is expected in the second half of this year.
Bright Food Group, based in east China’s Shanghai city, is one of the largest food group in China, and a local state owned enterprises in Shanghai.
