Meiji Exits China Dairy Business in $47.2m Deal
28 July 2026–Japanese food group Meiji Holdings has agreed to sell its dairy and business-to-business (B2B) operations in China to Shanghai AustAsia Food for RMB320 million (approximately US$47.2 million), marking a strategic shift in its China business after several years of changing market conditions.
The transaction covers Meiji’s drinking milk, yogurt and B2B operations through Meiji (China) Investment, Meiji Dairies (Tianjin) and Meiji Dairies (Suzhou). Before completion, the businesses will be transferred into a newly established subsidiary, which will then be acquired by Shanghai AustAsia Food. Upon completion, Meiji will no longer hold any equity interest in the business.
In its announcement, Meiji said China’s dairy market has undergone significant changes in recent years, citing shifting consumer preferences, evolving sales channels, intensifying competition and rising raw material and logistics costs. These developments have prompted the company to review its business portfolio and reallocate management resources to areas with stronger growth potential.
The company said it intends to strengthen its focus on higher-priority businesses in China, including its chocolate operations, while certain yogurt-related intellectual property and brands will remain outside the transaction. Trademark licensing arrangements will also be established for selected products to maintain Meiji’s quality standards following the sale.
The divestment marks a notable change in strategy. In 2020, Meiji invested US$254.4 million to acquire a 25% stake in AustAsia Investment Holdings to secure a stable supply of raw milk and support the expansion of its dairy business in China. Six years later, the company is exiting the segment as it reshapes its business priorities in one of Asia’s most competitive consumer markets.
