Lunar Capital acquires majority stake in snack firm Guizhou Yonghong Food

Shanghai-based private firm Lunar Capital has completed the acquisition of a 70% stake in Guizhou Yonghong Food, a producer of snack food in China, for $50m.

Guizhou Yonghong Food, established in 1984 and based in Huishui County, Guizhou, produces and distributes processed beef products including beef jerky, beef floss, stewed beef and tofu snacks under the brand of ‘Niutou’, which means Bullhead.

The company is a leading player in the snack food industry and its products are available in more than 2,000 supermarkets and 10,000 convenience stores across the country.

Following the acquisition, Lunar Capital’s operations team will take over the management of Guizhou Yonghong Food.

Lunar Capital’s operating partner Eric Yiming will take up the position of chief executive officer and will work with the co-founders of Guizhou Yonghong Food – Tang Kelin, Tang Kexiang and Liu Zhongying, who will retain a minority stake.

Lunar Capital managing partner Derek Sulger was quoted by the Wall Street Journal as saying that the investment will be used for research and development and launching new brands that will attract niche customer segments.

In addition, Lunar is set to open an office in Guizhou province to provide additional staffing and support business development.

Currently, Lunar Capital holds stakes in other businesses including branded beverage, food packaging, meat processing and other consumer sectors.

Lunar Capital Management, established in 1999, primarily invests in China with a focus on central and western China.

It operates offices in Chengdu and Shanghai in China, and Central in Hong Kong.