May 19, 2021

China Youran Dairy Group looks to raise US$800 million in Hong Kong IPO

China Youran Dairy Group looks to raise US$800 million in its Hong Kong initial public offering (IPO), according to two sources, as the group looks to expand its breeding herd and ramp up feed and raw milk production, Reuters reported.

The deal for the private equity group PAG-backed company is set to launch next week, said the sources.

As this information is not yet made public, the sources cannot be named. Youran Daily did not respond to a request for comment.

Based on a pre-deal term sheet viewed by Reuters, Youran Daily will sell 15% of its shares in the IPO to value the group at US$5.3 billion.

Last year, the group bought two farming hubs in in Ying and Yutian counties for NZ$513 million (~US$371 million; NZD 1 = US$0.72) from New Zealand's Fonterra.

PAG, which has a stake in Youran Daily since 2015, currently owns 42.89% of the company. Inner Mongolia Yili Industrial Group owns 40%. According to the filing, PAG will not be a controlling shareholder following the deal.

- Reuters