Royal Dairy Shares Increase After Company Announces Acquisition

Guangxi Royal Dairy Co. rose the most in more than seven months in Shenzhen trading after announcing an agreement to buy a 55 percent stake in a producer of yogurt and milk based in southwestern China.

Royal Dairy rose by the 10 percent daily limit to 17.80 yuan in Shenzhen, the biggest one-day increase since November. China’s benchmark Shanghai Composite Index gained 2.2 percent.

Royal Dairy agreed to pay 97.8 million yuan ($15.1 million) for the stake in Dalilaisier Dairy Ltd., which is based in the province of Yunnan. The acquisition is being made as part of Royal Dairy’s efforts to increase sales outside Guangxi province, where the company is based, according to a statement filed to Shenzhen’s stock exchange.

Dalilaisier Dairy, which sells products using the Lesson brand name, had 117 million yuan of sales and 5.27 million yuan of net income last year, according to the Royal Dairy statement.

To contact the editors responsible for this story: John Liu in Beijing at

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