Danone quiet on Indian milk buy talks

By Neil Merrett

- Last updated on GMT

Related tags Milk Dairy Danone

Danone yesterday remained tight lipped over the possibility of
making an imminent acquisition into India's high growth dairy
market, as part of the company's longstanding expansion aims for
the country.

A spokesperson for the company refused to comment on claims, appearing this week in Indian-based newspaper The Economic Times, that it was in talks with local dairy group Keventer over acquiring a stake in it milk-processing operations.

According to the paper, Keventer chairman Mahendra Jalan confirmed that Danone was in discussions over the possibility of acquiring a "majority share" in their milk processing arm.

A representative for Danone last year told DairyReporter.com that the Indian fresh dairy market was a particular area of interest for the group, reflecting the growing importance of emerging markets like India to dairy processors.

The company also added that it has been present in Indian dairy production since 2005, when it entered into a joint venture agreement with Japan-based Yakult to push probiotic products onto the local market.

Any potential move to step up milk production in the country comes as demand for liquid dairy products (LDP) soars globally.

Asian nations, particularly in the case of China and Aisa, were found to be two of the key markets pushing global dairy demand, according to figures supplied by packager and processing group Tetra Pak.

In 2007, consumption of LDP was expected to reach an all time high of 242bn litres, a 5bn litre rise over 2006, Tetra Pak said.

LDP consumption in India alone during 2007 was estimated to rise by 1.4 billion litres to reach 50 billion litres.

In China, the figure was expected to increase by 1.7 billion litres to reach 17.5 billion litres this year.

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