Yili Industrial Group, China's largest dairy company, is investing $214 million in a new infant milk powder plant in New Zealand to enhance competitiveness and meet rising demand for infant formula.
Target Information
China’s largest dairy company, Inner Mongolia Yili Industrial Group, plans to invest $214 million in a new infant milk powder plant located in New Zealand. This strategic investment is expected to intensify competition within the New Zealand dairy sector, particularly against local heavyweight, Fonterra. Yili's interest derives from New Zealand's relatively low raw milk prices and the advantageous free trade agreement between China and New Zealand, which will eliminate dairy import tariffs by 2020.
Yili's acquisition of NZ Oceania Dairy is pending approval from both the Overseas Investment Office (OIO) in New Zealand and the relevant Chinese regulatory bodies. Oceania Dairy's primary asset is the land resource consents for developing a dairy processing facility located in South Canterbury. This acquisition marks Yili's third significant investment in New Zealand’s dairy industry, following investments by Bright Dairy in Synlait and Shanghai Pengxin's purchase of the Crafar farms.
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Industry Overview
The New Zealand dairy industry is globally recognized for its high-quality products and efficient production practices. Comprising a significant portion of the nation's economy, the sector has experienced notable growth propell
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Disclosed details
Transaction Size: $214M
Revenue: $249M
Net Income: $22M
Enterprise Value: $249M
Equity Value: $22M
Multiples
EV/Revenue: 1.0x
P/E: 1.0x
P/Revenue: 0.1x