J.M. Smucker acquires minority interest in Chinese oatmeal maker

US-based J.M. Smucker has acquired a non-controlling minority stake in Guilin Seamild Biologic Technology Development, a Chinese manufacturer and marketer of oats products, for about $35m.

According to Smucker, the acquisition, which marks its first entry into the Chinese market, is consistent with its goal of increasing its international presence.

J.M. Smucker chief executive officer Richard Smucker said Seamild is a family-run business, similar to Smucker in many respects, and is an established leader in the rapidly growing oats category in China.

"This transaction represents an exciting first step as we look to develop a meaningful presence in China over time," Smucker added.

J.M. Smucker spokeswoman Maribeth Badertscher said the Seamild’s products will be manufactured and distributed in China only.

Seamild’s product portfolio primarily includes oatmeal, sold under Seamild brand to retail channels across China

The company, which is headquartered in Guangxi province in China, has two facilities in southern China, while the third facility is currently under construction in northern China and is expected to open in the summer.

Smucker, which has a small international presence, has been eyeing to enter China since 2010, and even established its office in Shanghai.

The deal marks Smucker’s first foray into the oatmeal category, although it produces the cereal product Red River Hot Cereal, which is made with cracked wheat, cracked rye and flax seed.

The company does not expect the acquisition to have much of an impact on its profit for fiscal 2012.

Image: Seamild’s product portfolio primarily includes oatmeal, sold under the Seamild brand to retail channels across China. Photo: The J. M. Smucker Company