Ildiko Szalai, Packaged Foods Industry Analyst at Euromonitor, explains that PAI Partners has stated its intention to sell its 50% stake in Yoplait, the world’s second largest yoghurt brand. As a result, potential suitors have emerged. These include:
- Sodiaal (which holds the other 50% stake in the brand)
- Inner Mongolia Mengniu Dairy Industry
- Grupo Lala
In terms of further international expansion, potential buyers with strong emerging market infrastructure and knowledge/ability to launch the brand in new, dynamically growing geographies, such as China, or expand further in existing markets, such as Mexico, would likely achieve good growth results with the brand.
Sodiaal itself is believed to be interested in re-acquiring full control of Yoplait. However, there has also been speculation that Sodiaal’s member farmers may no longer be as reluctant to sell the Yoplait brand in its entirety to another dairy company or at least more of its stake and thus become a minority investor.
General Mills, which has held the US licence for Yoplait since 1977, is also expected to be among the potential bidders. However, General Mills’ presence in the emerging world is relatively minor and it is noticeable that the company has been slower than most at addressing this shortcoming.
Lactalis and Nestlé have also been rumoured in the past to be interested in acquiring the Yoplait brand. The two companies already run a joint venture, Lactalis Nestlé Produits Frais. As such, the two companies would jointly have the required organisational and financial capability to expand the brand’s geographic reach and at the same time strengthen their own portfolio with a label that has strong health credentials and good potential for further functional developments.
Both Inner Mongolia Mengniu Dairy Industry and Grupo Lala have been growing within the dairy industry. The purchase of a brand with the reputation and scope of Yoplait would grant them access to a truly global marketplace and expand their consumer base in comparatively affluent North America and Western Europe, which would give their margins a massive boost.