Photographer: Jasper Juinen/Bloomberg

Fosun, Beijing Sanyuan Are Close to Buying St Hubert Brand

  • Montagu’s margarine brand could fetch about 600 million euros
  • Fosun, Beijing Sanyuan bid comes as China cracks down on deals

Chinese buyers still have an appetite for deals when it comes to French spreads despite increasing scrutiny back home.

Fosun International Ltd. and Beijing Sanyuan Foods Co. are close to a joint deal to buy French margarine maker St Hubert from Montagu Private Equity, people familiar with the matter said.

The agreement for the brand, which Montagu has owned since 2012, could come as soon as this week, the people said, asking not to be identified because the plans are private. The business could fetch a price, including debt, of about 600 million euros ($702 million), one of the people said.

As China stepped up its scrutiny of capital outflows this year to protect its currency, Fosun was among a group of prolific acquirers -- the others being HNA Group Co., Dalian Wanda Group Co., Anbang Insurance Group Co. and the buyer of the AC Milan soccer club -- whose loans have been probed by the nation’s banking regulator.

Beijing Sanyuan, a major Chinese dairy producer, is controlled by the state and counts Fosun as its second-largest shareholder. Trading in shares of Sanyuan, a major dairy producer in China, have been suspended since July 17 pending a major acquisition, according to a regulatory filing. The company was among bidders for McDonald’s Corp.’s China business, people familiar with the matter said last year.

No final decisions have been made and the deal may still fall through, the people said. Representatives for Fosun and Montagu declined to comment. Beijing Sanyuan didn’t immediately respond to requests outside regular business hours.

Fosun has announced more than $14 billion in deals since 2014 to expand its assets including Club Med and Cirque du Soleil Inc., according to data compiled by Bloomberg, making it one of China’s most acquisitive groups in recent years.

Brands selling milk products and alternatives are changing hands as growth of margarine and other spreads slows and consumers seek to cut down on dairy items. Consumer brands giant Unilever has said a sale process for its spreads business will take place in the autumn, and the company will seek a binding agreement for the unit by the end of the year.

— With assistance by Miao Han, Jonathan Browning, Francois De Beaupuy, and Jing Yang De Morel

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