Leading Chinese, vertically integrated chicken producer, Fujian Sunner Development Co., and global investment company, KKR announced the closing of KKR’s strategic investment of $400 million in the company in exchange for an 18% stake in the operation.
The new partnership will work to expand the company’s operations and facilitate the distribution of safe chicken products to Chinese consumers seeking high quality meat products. This growth will be supported through the capitalization of Sunner’s industry expertise and knowledge, and KKR’s investment experience and network.
Sunner is China’s largest breeder, processor, and supplier of fresh and frozen chicken for China’s fast food industry, food manufacturing industry and wholesale markets. Sunner controls the entire production chain from the farm, to the management of the feed mills, to the processing – which give a higher guarantee of safety and quality. Because of this, since the announcement of the strategic investment in August 2014, Sunner has been chosen as the only Chinese supplier of chicken meat to McDonalds. As a sign indicating the partnership’s confidence in the growth of China’s demand for high quality chicken meat, Sunner is targeting an increase in production volume of 30% in 2015, and more than doubling its current production capacity to 750 million heads of chicken by 2019.
“We welcome KKR as a world?class investor to support Sunner’s growth. KKR has done a number of successful investments in China’s agriculture and food safety space. We believe they will bring great agricultural experience and management expertise to this partnership and together we look forward to enhancing Sunner’s ability to meet China’s demand for healthy chicken products,” says Fu Guangming, Chairman of Sunner.
In line with the strategic investment, Sunner and KKR have also entered into a strategic corporate agreement under which they will create a joint working group to drive operational improvement, corporate governance, and other strategic initiatives.
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