Heinz to sell China packaged food business to Zhengzhou Sanquan Foods
25 Feb 2013
H J Heinz Co, the global US foods giant, which this month agreed to be acquired by Warren Buffett and 3G Capital, is selling its China packaged food business to Zhengzhou Sanquan Foods Co for an undisclosed sum.
Henan-based Zhengzhou Sanquan said in a filing dated 23 February that it has signed a deal with Heinz's subsidiaries, Country Ford Development Ltd and Heinz (China) Investment Co, to buy Shanghai Long Fong Food Company Ltd.
The company said that the acquisition will help it increase its competitiveness and expand market share.
In 2004, Heinz acquired Long Fong, a well-known brand in the fast frozen food industry in China. Its products cover eight major categories including dumplings, rice ball, dim sum, hot pot base, steam bread, and others.
LongFong had reported sales of $27 million and $51 million in the nine months ended 27 January 2013 and 25 January 2012, respectively.
The deal comes more than a week after the Pittsburgh-based company, the world's biggest ketchup maker agreed to sell itself to Warren Buffett's investment arm Berkshire Hathaway and Brazilian billionaire and financier Jorge Paulo Lemann's private equity firm 3G Capital for $23 billion, plus $5-bn debt. (See: Warren Buffett, 3G Capital to buy HJ Heinz Co for $23 bn)