Bright Food (Group) Co, a major Chinese food company and a unit of CITIC Group, China's biggest financial conglomerate, has formed a 2 billion yuan (US $264 million) private equity fund to invest in China's food industry.
Bright Food and CITIC Capital Holdings Ltd will each hold a 50 percent stake in the fund, which will target raw materials, research, production, packaging and retailing businesses in the food industry, Bright Food said in a statement on its Web site. Bright Dairy's contribution to the fund is part of a 9 billion yuan investment plan for expansion over the next three years, said Xu Yongxin, a spokesman for the Shanghai-based company.
The tie-up came days after state-owned Bright Food signed a strategic co-operation agreement with Indonesian conglomerate Salim Group for overseas expansion. Bright Food was created a year ago as the result of a government-directed merger of four state-owned food companies in Shanghai. Bright Food, which owns four Shanghai-listed companies and about 3,300 retail outlets, posted 45 billion yuan ($6 billion) in sales last year.
CITIC Capital, founded in 2002, manages more than $1.3 billion and invests mainly in China. The company in April said it had raised US $425 million for buyouts in China. CITIC Capital came to prominence with a landmark investment in Chinese pharmaceutical firm Harbin Pharmaceutical Group jointly with US private equity firm Warburg Pincus.
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