Danone prepares the sale of its stake in China Mengniu

Business

By CAPosts 28 February, 2021 - 05:23pm 52 views

The French company Danone reported that it will sell its almost 10% stake in the Chinese dairy company Mengniu. The announcement of this operation, which is expected to be completed before the end of 2021, comes on the eve of a Danone board of directors, convened at a time when President Emmanuel Faber is confronting the discrepancies of its shareholders. To divest its stake in Mengniun, Danone will first convert its indirect stake in Mengniu into a direct stake, following an agreement reached with COFCO Dairy Investments Limited, the French group explained. 'Once completed, this operation (...) will allow Danone to own a direct 9.8% stake in Mengniu. A Danone divestment of its Mengniu stake could then take place in 2021 through one or more transactions, depending on market conditions, 'he added.

© E + Yoghurt pot, wooden table background

Jürgen Esser, Danone CFO , explained that this operation "will translate into a significant return for shareholders, while we continue to develop our operational platforms in China, a strategic country for Danone." According to the statement, "Danone's indirect participation in the capital of Mengniu currently has a book value of 850 million euros." Danone entered the capital of Mengniu, which is listed on the Hong Kong stock exchange, in 2013 acquiring 4% of its shares, but the following year it already had 10%. This entry into capital came about through the creation of a joint venture with the Chinese public group COFCO, Mengniu's main shareholder.

Source: MSN