I like to write occasionally about the market for traditional Chinese liquor known as baijiu, often more out of personal interest than because I see any big potential in the sector. While many of China’s other food and beverage sectors have consolidated around a few key players over the last 15 years, baijiu has been strangely resistant to such a movement. As a result, the industry remains highly fragmented and not very interesting for investors. But recent signs are pointing to a potential consolidation finally on the way, including the latest word that food and beverage giant Wahaha is entering the field in a bid to develop a new national brand based in southwest China’s Maotai county, an area famous for the traditional liquor. Read Full Post…
After 2 previous failed attempts to tap the China market, French food giant Danone (Paris: DANO) is trying yet again through a new major tie-up that includes a joint venture and equity stake in tainted dairy giant Mengniu (HKEx: 2319). This time I have to commend Danone on its choice of partners and approach in the new tie-up, which seem to show it’s learned its lesson from previous disastrous partnerships with 2 other locally controlled entities. Accordingly, the third time could finally be the charm for Danone as it looks for a success in the huge but often problematic Chinese food market. Read Full Post…
