Retailing, Franchising, and Consumerism Business Intelligence in China

Yili To Sell 40% Stake In Youran For CNY1.4 Billion

Chinese dairy group Yili will transfer its 40% stake in Inner Mongolia Youran Farming for CNY1.4 billion and Youran will become a foreign-owned enterprise after the transaction.

According to the report, Youran was founded in 2007 with CNY2.5 billion registered capital, of which Yili owns a 40% stake with CNY1 billion investment and Yogurt Holding I (HK) Limited owns the remaining 60% stake. During this transaction, Yili will transfer its 40% stake to Yogurt Holding I (HK) Limited.

Youran is reportedly engaged in dairy husbandry and raw milk sales. Its businesses cover the entire industrial chain of raw milk, including milk cow raising, raw milk production, and feed production and sales.

Yili also stated in its report that in the future, the company will continue to hold the 40% stake in Youran overseas by further equity adjustments; therefore, this transaction will not harm the interests of shareholders.

In addition, Yili will cooperate with PAG to jointly establish an overseas platform, which will fully use international capital market resources to solve the financial demand of Youran to further enhance Yili's milk source construction.

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