Food and agribusiness private equity fund manager Proterra Investment Partners Asia has invested in three Chinese firms for undisclosed sums, according to a statement on Thursday.
The investments include the acquisition of a majority stake in the nutrition and supplements business Zhong Hong; an equity interest in soy sauce brand Wuan Chuang; and a supplementary pre-Series A funding in healthy beverage producer No Ordinary Drinks.
Proterra Asia said in a statement that these investments were made in view of rising demand from a growing urban population and more consumers looking for safe, high-quality, food products that are healthy, and sustainable.
Proterra Asia acquired its majority stake in Zhong Hong from China Tuhsu, a company under the Chinese state-owned China Oil and Foodstuffs Corporation (COFCO), which continues to have a minority stake in the firm.
Zhong Hong is known for products in propolis, protein powder, and herbal health, and has increased its revenue at a CAGR of 20% since 2013, Proterra Asia said. Following the acquisition, Zhong Hong plans to acquire smaller businesses in the same line, it said.
Healthy drinks, soy sauce
According to the statement, Proterra Asia led a second tranche pre-series A funding round in Shanghai-based No Ordinary Drinks in January, following a first tranche two months earlier.
Proterra Asia said the round valued No Ordinary Drinks at a nine-figure valuation. No Ordinary Drinks makes stevia-sweetened flavoured waters and sparkling juices.
The funds will be used to increase production, as well as distribution and marketing. It will also launch its drinks in Singapore and Germany.
Separately, Proterra Asia also funded the Chuang family, who own Taiwanese soy sauce brand Wuan Chuang, the statement said. The private equity firm will gain an equity interest in a Chinese premium soy sauce joint venture formed in 2015 owned by the Chuangs and Yihai-Kerry Arawana, China’s largest edible oils brand.
“China is the world’s largest market for soy sauce and over the next decade, premium soy sauces are expected to gain a significant market share. Proterra Asia’s investment will assist Wuan Chuang to continue to fund the growth of the soy sauce JV,” it said.
“The recent transactions made in Zhong Hong, NOD, and Wuan Chuang joint venture are fully aligned with our strategy of focusing on the fastest-growing sub-sectors within the food sector in Asia,” said Tai Lin, the managing partner of Proterra Asia in a statement.
“We are actively pursuing megatrends such as the growing consumer focus on nutrition and healthy lifestyles as well as the high demand for premium, high-quality, food & drinks.”
Proterra is also known for its investment in alternative proteins, such as faux-egg and cultivated meat producer Eat Just, and oat milk maker Oatside.
In a previous interview with DealStreetAsia, Lin said alternative proteins have huge potential in Asia, given its history of eating vegetarian food, bean products, and mock meat.
Proterra, which was carved out of US agribusiness giant Cargill unit Black River Asset Management in 2016, has three Asia-focused funds. The first was a $460 million fund that closed in 2011, and the second was a $700 million fund that closed in 2015. The third fund was launched in May 2019. It secured $35.7 million as of September 2020, according to an SEC filing.
Proterra is also an investor in Chinese yoghurt brand Simple Love and the fresh egg producer Yellow Swan.
