China's second-largest food company Bright Food Group has agreed to sell British-based breakfast cereal maker Weetabix to US company Post Holdings in a deal worth Sh186.2 billion ($1.8 billion), Bloomberg News said Tuesday.
State-owned Bright Food bought a 60 per cent stake in Weetabix for 1.2 billion pounds in 2012, part of an aggressive search for overseas assets as it sought to expand its global footprint.
At the time the deal was the largest overseas acquisition by a Chinese company in the food and beverage sector.
A Bright Food spokesman confirmed to Bloomberg that the Shanghai-based company would sell its stake to cereal manufacturer Post, with Baring Private Equity Asia holding the remaining 40 per cent.
He said Weetabix's China sales had risen sixfold in the past year but the company still sells most of its product in Britain, since Chinese consumers are unused to eating cold cereal for breakfast.
Overseas acquisitions remain an important part of Bright Food's plan to become an "internationally influential, multinational company", the spokesman added.
Weetabix's total sales in 2016 as of January 2 dropped 1.6 per cent year-on-year, and profit fell 15 per cent to £84.6 million (around Sh11 billion), according to Bloomberg.
Based in Northampton in central England, it employs about 1,800 staff worldwide and its cereals are exported to more than 80 countries.