Junlebao Enter a New Independent Phase with Investor Support

Primavera Capital Group, Ping An Capital, and Junqian Management have announced to acquire a 51 percent stake in dairy producer Junlebao for RMB 4 billion. Following the deal, Junlebao will officially complete a spin-off from China Mengniu Dairy to enter a new, independent phase of its corporate development.

Founded in 1995, Junlebao has firmly established its position as a leading national enterprise in agricultural industrialization following 20 years of development. The company has a well-established business model covering the entire dairy industry chain, with business lines including infant milk powder, low-temperature and room temperature yogurt, liquid milk and animal husbandry. Following the successful launch of its flagship products such as “Purjoy” and “Cheese Yogurt (涨芝士啦)”, its market share of low-temperature yogurt now ranks among the top three in China.

The company has established a full industry chain model of “forage planting + cattle breeding + milk processing”, including a rigorous quality control system incorporating four key chainlinks, namely milk source, raw materials, process equipment, and management systems. In 2014, Junlebao officially entered the infant formula milk powder market. The high quality standards maintained by its factories, together with an A+ quality certification by the BRC Global Standards, meant that the company was fully recognized by the domestic market and has since successfully expanded to the Hong Kong and Macau markets. Within five years it has become a top-tier domestic milk powder maker.

Fred Hu, founder and chairman of Primavera Capital, said, “Primavera has long focused on the new growth model of China’s economy and explored investment opportunities brought about by urbanization, consumption upgrade and technological innovation, with particular attention to the rise of Chinese local consumer brands. Primavera is optimistic about the development of leading dairy producers in China. We are committed to supporting outstanding privately-owned enterprises like Junlebao through a series of value-added professional services, in order to help enhance its business operations and support the company as it enters a new phase of its development.”

Primavera Capital is confident about the growth potential of China’s dairy industry and Junlebao’s growth. Samantha Xiao, Executive Director of Primavera Capital, said, “Primavera has extensive industry resources and experience in the consumer sector. We invested in leading companies in retail and consumer such as Yum China, Alibaba, and UBOX, and we are keen to collaborate with Junlebao to achieve synergies in products, brands, channels, etc., thereby helping Junlebao achieve sustainable and rapid growth.”