Verlinvest, a Belgium-based investment company backed by the family controlling beer giant AB InBev, is planning a big push into China with the aim of building the next generation of successful brands and entrepreneurs in the country’s food and beverage (F&B) sector.
The company is owned by the De Spoelberch family, one of the three Belgian families that founded Interbrew and then AB InBev. It has offices in London, New York, Singapore, Mumbai and Brussels, and manages about US$2 billion in funds. It expects to have a lot of investments in China in the next few years, said executive director Raphael Thiolon.
“We are very keen to back Chinese entrepreneurs, helping them to build new successful food and drink brands of tomorrow,” he in an interview with the Post.
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Verlinvest will aim to build on its experience with Sweden-based Oatly, the world’s largest oat milk producer. Oatly’s sales in China have risen to account for 13 per cent of its global sales since it entered the mainland market in 2018. Verlinvest is Oatly’s largest shareholder together with Chinese conglomerate China Resources and holds 47.6 per cent following the oat milk producer’s US$1.4 billion initial public offering on the Nasdaq last week. This is based on over allotment not being exercised. The stake will reduce to 45.9 per cent if the over allotment is exercised.
“We would like to be a partner of choice for every entrepreneur with a purpose and big ambitions, like we did with Oatly,” Thiolon said. China is quickly becoming one of Oatly’s largest markets.
“We are seeing exciting structural changes, with Chinese consumers increasingly drawn towards healthier nutrition, cleaner products and natural functionality. China offers fantastic growth opportunities for authentic yet innovative brands that promote high-quality offerings but also generate positive impact,” he said.
Verlinvest’s mainland Chinese investments will focus on services, packaging and alternative protein companies in the F&B sector. According to China Chain Store & Franchise Association, this sector was worth about US$595 billion in 2019, a 7.8 per cent increase over the previous year.
The company’s current investments in China were relatively small when compared with those in other Asian countries, such as India, Thiolon said. But Verlinvest will correct its strategy and speed up investments in China, one of the world’s largest consumer markets, he added.
Verlinvest currently has investments in Nasdaq-listed 111.com, a Chinese online pharmacy and health service platform. It is also providing senior care and services in the Yangtze delta area through a joint venture with China Resources. This joint venture has acquired five senior care platforms mainly operating in Shanghai, Beijing, Guangzhou, Chongqing and Chengdu. They now operate about 40 nursing homes with nearly 8,000 beds in total.
The company has a strong track record of investing in consumer brands and digital platforms, such as Vitamin Water, which was sold to Coca cola for more than US$4 billion, and Lazada, a leading e-commerce platform in Southeast Asia, which was sold to Alibaba Group Holding for more than US$3 billion.
Oatly’s IPO gives the company a market value of about US$10 billion. It counts celebrities such as Oprah Winfrey, Natalie Portman and Jay-Z among its strategic investors. Its stock closed at US$20.73 on Monday in New York.
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