French yogurt maker Groupe Danone SA said Tuesday it is selling its whole stake in China's Bright Dairy & Food, ending a 15-year alliance with the Shanghai-based food conglomerate.
Danone plans to sell its 20.01 percent stake in Bright Dairy for 954.85 million yuan (US$127 million; EUR89 million) to Shanghai Milk Group and to S.I. Food Products Holdings Ltd., with each company buying 104.24 million shares.
The deal, which requires regulatory approval, will increase the stakes in Bright Dairy held by Milk Group and S.I. Food to 35.18 percent each, up from 25.17 percent each.
"The relevant business cooperation agreements and the intellectual property license agreement between the two parties (Danone and Bright) will be terminated as well," Danone said in a statement.
Danone said its cooperation with Bright had achieved "favorable results," but that the companies agreed on the equity transfer for the sake of their individual business strategies.
Danone and Bright set up a 50-50 yoghurt joint venture in 1992.
The French dairy goods maker also has a joint venture with China's biggest milk producer, China Mengniu Dairy Co., to make yoghurt and a stake in China Huiyuan Juice Group.
A joint venture with Chinese beverage maker Wahaha Group has been dogged by conflicts over ownership and management issues - including Danone's business ties with local competitors.