KKR has invested in Yuehai Feed Group, China’s largest manufacturer of high-end special aquatic feed products. The size of the investment was about $100 million, according to a source with knowledge of the deal.
The investment comes from KKR’s China Growth Fund, a 2010-vintage vehicle that raised $1 billion, and which is about 70 percent committed. The fund makes growth equity investments in China, Hong Kong and Taiwan, and typically invests between $30 million to $75 million in its portfolio companies.
Guangdong-based Yuehai and KKR are partnering to expand the company’s operations and provide safe and high-quality aquatic feed to the country’s large base of fish farmers and suppliers, according to a statement, which added the increased Chinese demand for protein was a factor in the investment.
Yuehai aims to capture growth opportunities in the large and evolving freshwater fish feed sector as the industry upgrades its technologies. This includes transitioning from raw frozen fish and traditional pellet feed to the more environment-friendly floating puffed feed, said KKR.
This is KKR’s fifth partnership in working with leading Chinese companies to advance food safety and security in China, the firm added in a statement.
KKR remains invested into other Chinese food producing companies, including the 2014 acquisition of a $400 million stake in Fujian Sunner, a poultry producer, and a $150 million stake in COFCO Meat, the state-owned meat processor and industrial pig farmer.
In September 2014, KKR sold its stake in China Modern Dairy Holdings for $80 million, returning three times on it original investment, according to Agri Investor.
Investors in the China Growth Fund include the New York State Common Retirement Fund, Alaska Permanent Fund, Michigan Department of Treasury, Princess Private Equity Holding and the University of Oklahoma Foundation, according to PEI’s Research & Analytics division.