Danone Partners With China Mengniu Dairy In Latest Stab At China's Yoghurt Market

French dairy company Danone invested €325 million in two business agreements with China Mengniu Dairy Co. Ltd. as part of its efforts to increase its share of China's dairy market. Danone's previous attempts to expand its business in China's €2 billion yoghurt market, which the company expects to more than double in the next five years, have failed. Mengniu also expects to benefit from its deal with Danone, which it expect to help ease local consumers' concerns over quality following the 2008 scandal involving melamine-laced milk in China, which is Danone's fourth-largest market after Russia, France, and the United States. As part of the deal, the companies will form a joint venture between Danone and state-owned food company COFCO, Mengniu's biggest stakeholder.