PARIS (Reuters) – French food group Danone said on Thursday it would spend 100 million euros ($114.08 million) to strengthen its Specialized Nutrition business in China, as it bets on the Chinese market as a source of growth.

The investment entails opening a research centre focused on breast milk and gut health in Shanghai and the acquisition of local infant milk formula company Murray Goulbum Dairy Co Ltd from Saputo Dairy Australia, the statement said.

The acquisition brings Danone, maker of high-end infant milk formula brands such as Aptamil and Nutrilon, a new registered infant milk formula brand and an infant milk product facility located in Qingdao, its first in China.

China is an important source of growth for Danone. It contributes about 30 percent of sales of the Early Life Nutrition business, which makes infant formula, and accounts for the bulk of Danone’s Specialized Nutrition business.

The Specialized Nutrition business, which also includes Medical Nutrition, generated 30% of Danone’s 2019 group sales of 25.3 billion euros.

The business’s sales grew 5.8% on a like-for-like basis, topping the group’s 2.6% growth last year.

Danone said on Thursday its Early Life Nutrition business in China has achieved B-Corp certification as a for-profit corporation committed to positive social and environmental goals. The Danone group has a goal to be certified as a B-Corp by 2025.

(Reporting by Dominique Vidalon; editing by Barbara Lewis)

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