KKR invests $400 mill. in Chinese chicken pro...

KKR invests $400 mill. in Chinese chicken producer

schemmi / pixelio.de

U.S. private-equity firm KKR & Co. continues to put money in China's food sector, announcing it has agreed to invest $400 mill. in Chinese chicken meat producer Fujian Sunner Development Co. Ltd.

According to an announcement, KKR will take an 18% stake in the company based in the southern Chinese province of Fujian. The company is the largest breeder, processor, and supplier of chicken products in China.

KKR's investment comes as the poultry industry in China is struggling from yet another food safety scandal after U.S. meat supplier OSI Group Inc.'s Shanghai dependance was accused last month by Chinese authorities of selling expired meat to restaurant companies including McDonald's Corp. and Yum Brands Inc. The poultry industry has also suffered from the impact of repeated bird-flu outbreaks in China, triggering a sharp fall in sales. Shenzhen-listed Fujian Sunner is a supplier to KFC and other fast-food chains in China.

Like other agricultural products in China, poultry farming remains highly fragmented in the country. Small-scale farms in China have just a few hundred birds each, and are prone to using excessive amounts of feed additives that accelerate animal growth, for example.
Source: Fujian Sunner Development Co. Ltd.


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