Swiss food giant Nestlé has announced plans to purchase Chinese confectioner Hsu Fu Chi for SFr1.4 billion ($1.67 billion).
The deal would give Nestlé 60 per cent ownership of the company. Hsu Fu Chi would retain 40 per cent, according to a statement published on Monday.
“This suggested partnership would do a lot to increase our presence in China,” said Nestlé CEO Paul Bulcke.
The Chinese company’s CEO, Hsu Chen, would remain in that position. Nestlé, based in canton Vaud, has said that it does not plan to change how the confectioner operates or to cut staff. What would change is that Hsu Fu Chi would appear on the Singapore stock market.
Chinese authorities still have to approve the takeover. The market value of Hsu Fu Chi is about $2.6 billion. Its 2010 turnover was about $669 million.
Hsu Fu Chi has four large factories and employs 16,000 people. Nestlé currently has 23 factories in China and 14,000 employees.
swissinfo.ch and agencies