China Huiyuan Juice Surges in Hong Kong After Danone Sells Stake to SAIF

China Huiyuan Juice Group Ltd., the company Coca-Cola Co. proposed to buy before being blocked by Chinese regulators, rose the most in almost two months after Groupe Danone SA agreed to sell its stake to SAIF Partners Ltd.

Huiyuan rose as much as 7.9 percent to HK$5.85, the biggest intraday gain since June 8, and traded at HK$5.78 at 11:58 a.m. in Hong Kong. The benchmark Hang Seng Index rose 0.2 percent.

SAIF Partners, which manages $4 billion, will acquire Danone’s 22.98 percent stake for HK$6 a share, the French company said in a statement yesterday. Beijing-based Huiyuan competes for beverage sales against Coca-Cola Co., PepsiCo Inc. and other beverage drink makers that are boosting spending in China to expand beyond soft drinks.

“We expect renewed market talks of M&As for Huiyuan,” UBS AG Product Manager Herman Chan said in a note to clients. Huiyuan’s stock “is likely to enjoy a boost in the near term.”

Danone, the world’s biggest yogurt maker, has vowed to avoid joint ventures in China after it sold its stake in food and beverage maker Hangzhou Wahaha Group Co. in 2009, ending two years of lawsuits.

Hong Kong-based SAIF Partners, a venture-capital fund focused on China and India, will spend 200 million euros ($260 million) to acquire the Huiyuan stake.

Huiyuan has gained 4.7 percent this year, compared with a 3.4 percent decline for the Hang Seng Index.

To contact the reporter on this story: Wendy Leung in Hong Kong at wleung12@bloomberg.net

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