Bright Food gets approval for Manassen acquisition

September 7, Shanghai-based Bright Food (Group) Co. Ltd., one of China’s largest food conglomerates, has gained approval from Australian authorities to buy Manassen Foods Australia Pty Ltd., marking a major step forward in the group’s acquisition drive.

Bright Food has agreed to pay AS$397.5 million for a 75% stake in Manassen, the largest deal to date for the Shanghai-based group, and is now awaiting the final go-ahead from Chinese regulators.

A successful conclusion to the deal may act as a springboard for further acquisitions, with wine assets a likely target.

“We expect to use Manassen as a platform for Bright Food to exploit the Australian and New Zealand markets, and we would like to seek further acquisitions in those countries, but it’s hard to say that would involve a wine company or not,” Ge Junjie, chairman of Bright Food, said at an event marking the 60th anniversary of its subsidiary Shanghai Tangjiu (Group) Co. Ltd. on Tuesday.

Integrating Manassen

“We’ve got strong support from the Shanghai Municipal Government, and should everything else goes well, we could complete this deal in 2 months with approval from the Ministry of Commerce and National Development and Reform Commission,” Ge said.

The remaining 25% stake in the Australian company will be retained by Manassen’s management team, something Ge said he considers essential for keeping the team together.

Manassen has been the Australian supplier to many world-class food brands, and Bright Food hopes to extend that client base to mainland China, where demand for overseas foodstuffs is growing with economic development.

“We also hope to bring more of our products, from liquor to milk, to Australia and New Zealand via the Manassen platform. I believe Chinese products are going to gain more and more recognition globally and for us, acquiring Manassen is more about strategic deployment in advance,” Ge told the Oriental Morning Post.

Asset Spree

Bright Food signaled its intent last year to acquire foreign assets with a bid for the sugar unit of Australia’s CSR Ltd., which was eventually sold to Singaporean firm Wilmar International Ltd.

Prior to the Manassen deal, Bright Food was reported to be considering a $2.4 billion bid for Australian Treasury Wine Estates Ltd., a former unit under Foster’s Group Ltd. Neither side has commented on the rumor so far.

Bright Food’s Ge insisted that globalization remains the group’s top priority in the long-term, without specifying if a wine company like Treasury Wine Estates would be its next target.