China’s Bright Food Group Co. appears to be moving closer to a deal with Israel’s Tnuva Food Industries Ltd., as sources close to the deal have confirmed that Citigroup Inc., is advising the Chinese company on its bid. The purchase of the Israeli dairy firm would be the Chinese group’s latest potential foray overseas, since the company recently bought Australia’s Manassen Foods and U.K.-based cereal maker Weetabix Food Co.
Having Tnuva would help Bright grow its dairy business at a time when a number of players are jockeying for position in China’s burgeoning dairy industry. A week ago Danone said it invested €486 million ($663 million) to raise its stake in China Mengniu Dairy Co., making the French company the second-biggest investor in China’s largest milk producer.
Tnuva is a major dairy player in Israel, controlling 14 percent of shelf space in the country, according to British private-equity firm Apax Partners LLP, which holds a majority stake in Tnuva.
Bright Food, the company that operates more than 3,300 retail stores across China, confirmed last week that it was in talks with Tnuva to purchase the Israel-based dairy manufacturer. A spokesman from Bright Foods said the two companies are in discussions but hadn’t closed a deal, while there has been no comment from the Tnuva side in regards to a deal.
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