Chinese dairy products maker Yili Group sets up $100m PE fund to invest overseas

China’s dairy producer Yili Group, fully known as Inner Mongolia Yili Industrial Group, has launched a $100-million private equity fund to invest overseas, according to the company’s filing with the Shanghai Stock Exchange (SSE) on Wednesday. 

Yili Group’s fully-owned subsidiary — Hong Kong Jingang Trade Holding Company — will serve as the fund manager to invest $100 million into the fund while YJLC GP Limited, a subsidiary of Hong Kong Jingang Trade Holding Company, will serve as the limited partner. 

The fund will enable Yili, one of the top five dairy products makers in the world in terms of dairy turnover,  to “back consumer industry-focused companies”, as well as to “catch up with the latest business model and products arising from the consumer sector”, according to the filing. 

For the first half of 2022, Yili posted revenues of 63.5 billion yuan ($9.2 billion), up 12.3% year-on-year, while its net profit stood at 6.1 billion yuan ($0.9 billion), up 15.4% year-on-year, according to a company release.

In the light of the ongoing COVID19 pandemic and the impact of inflation, the firm added in the release that it has managed to coordinate with its bases in China, Southeast Asian countries and New Zealand, with its overseas revenue growing 58% year-on-year.

In August 2020, Yili Group and its subsidiary invested 2-billion-yuan ($286 million) in private equity funds, fund management companies and enterprises with high growth potential. The fund also planned to make equity investment in growth-stage and pre-IPO firms. 

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