Chinese buyout firm Citic Capital is also weighing an offer for Jiahao ahead of the Friday deadline for first-round bids, said one of the people, who asked not to be identified because the information is private. The sale of the Zhongshan-based company, one of the first wasabi producers in China, has separately drawn interest from Hony Capital, the people said.
Jiahao, which is owned by Asian private equity firm Unitas Capital, could fetch about $600 million in a sale, the people said.
An acquisition of Jiahao would also bring products including soy sauce, chicken powder and abalone sauce carried in supermarkets across China. Jiahao is led by Chairman Chen Zhixiong, known as “the Father of Chinese Mustard,” according to its website. A deal would add to the $105 billion in acquisitions of food-related companies globally over the past 12 months, data compiled by Bloomberg show.
McCormick & Co. agreed in July to buy French’s mustard and other products from Reckitt Benckiser Group Plc for $4.2 billion. That same month, Post Holdings Inc. completed its $1.8 billion purchase of British cereal maker Weetabix Ltd., the data show.
No final decisions have been made, and there’s no certainty the suitors will proceed with bids for Jiahao, the people said. Representatives for Citic Capital, Hony and Unitas declined to comment. A representative for Jiahao said he can’t comment.
“As Hormel Foods continues to focus on its strategic imperatives to grow and expand, we are constantly exploring opportunities throughout our business as well as outside of our organization, including growth through acquisitions,” a representative for the U.S. food maker said by email. He declined to comment on any interest in Jiahao.
Hormel began operations in China in 1994, according to its website. Last year, it boosted its local production capacity with the opening of a new factory in Jiaxing, in eastern China’s Zhejiang province, that pumps out Spam and other products.
Unitas Capital, which manages more than $4 billion, has made more than 30 investments across Australia, Korea, Japan and Singapore since its founding nearly two decades ago, its website shows. It has bought stakes in Haitai Confectionery & Foods Co., the South Korean manufacturer of snacks and chewing gum, as well as Shanghai-based restaurant chain Jiayo Noodle House.
©2018 Bloomberg L.P.