Associated British Foods (ABF) has signed an agreement with Wilmar International subsidiary Yihai Kerry Arawana Holdings to form a joint venture company which will manufacture, sell and distribute yeast and bakery ingredients in China.
ABF and Yihai Kerry will both own a 50% stake in the new joint venture company, which will acquire the existing Chinese yeast and bakery ingredients activities of AB Mauri, a division of ABF, and will leverage Yihai Kerry Arawana’s supply chain, distribution network and local market expertise in China.
To expand manufacturing output, the joint venture will also build and operate a new yeast plant co-located with Wilmar’s food processing plant in Qiqihar City, China, significantly increasing production capacity.
ABF claims that the new joint venture will be well positioned to capitalise on the growth of traditional Chinese bakery products and western-style baked products, as consumer demand is expanding rapidly in both categories.
AB Mauri’s CEO, Cathal Duffy said: “This joint venture is a great opportunity to build on the foundation of our yeast and bakery ingredients business in China.
“The joint venture will leverage AB Mauri’s baking know-how and technology with Yihai Kerry Arawana’s extensive route to market, local management expertise and its complementary portfolio of products.
“We are looking forward to working with Yihai Kerry Arawana on the shared vision of building a successful bakery business together.”
Wilmar’s chairman and CEO, Kuok Khoon Hong, added, “Besides enhancing the range of quality ingredients, this joint venture will enable us to leverage on AB Mauri’s baking know-how and technology to provide better service to the baking industry in China.”
By Martin White
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