Chinese dairy group Yili is reportedly the frontrunner to acquire Stonyfield Organic, the yogurt business put on the market by Danone in March.
The company is believed to have made an offer worth $850 million for Stonyfield and appears to be the most likely suitor, according to the New York Post.
General Mills is also rumoured to have been interested in adding Stonyfield to its existing Yoplait and Liberté yogurt businesses. But it appears that the inflated valuation may have prevented it from making a bid; while $850 million may seem excessive for a brand that turned over $370 million in 2016 and generated profit of just $50 million, it could be a shrewd investment for a company with enough scale to enhance its success.
As analysts have pointed out in the wake of the announcement, Stonyfield’s financial performance is relatively impressive, given that its products are only available in the US.
Were Yili to acquire Stonyfield, it would surely create the opportunity to either expand the brand overseas or leverage its expertise in organic dairy to launch a new line of products in China.
Dean Foods is also interested in Stonyfield, the Post said.