TIAN TU CAPITAL recently announced the completion of the sale of approximately 86.96% of its stake in Yoplait China to Kunshan Nuoyuan Ruiyuan for a total consideration of about 1.565 billion yuan. This move marks the complete exit of the self-proclaimed "first consumer investment firm" from the French yogurt brand Yoplait, in which it had once placed high hopes.

Taking over the stake is IDG Capital. Including the shares held by management, IDG has acquired full ownership of Yoplait China for a total transaction value of approximately 1.8 billion yuan.

Yoplait entered the Chinese market during a period when the country's middle class was particularly keen on paying premium prices. In 2013, the world's second-largest yogurt brand was introduced to China by General Mills, which at the time was riding high on the success of its other brands, Häagen-Dazs and Wanchai Ferry. The multinational giant believed that by leveraging Häagen-Dazs’s distribution channels and brand influence, it could easily capture the premium yogurt market.

At that time, China's yogurt market was highly fragmented, with major players like Mengniu and Yili engaged in price wars, while Bright Dairy maintained a stronghold in eastern China. Yoplait entered the market with a single-cup price exceeding 15 yuan, which was five to eight times the price of liquid milk at a time when raw milk cost just over 2 yuan per kilogram.

To justify this premium, General Mills invested hundreds of millions of yuan in building a highly automated factory in Kunshan, Jiangsu. The company imported cows from Australia and insisted on using a high proportion of raw milk and maintaining a very short shelf life. For a long time, Yoplait was seen as a symbol of "French elegance" in upscale supermarkets like Olé and Hema in Shanghai.

However, this approach reflected a typical case of multinational corporate path dependency. Decision-making power for Greater China at General Mills often resembled remote control from headquarters. While local Chinese brands like Jianai and Kars started educating consumers about "clean labels" and "sugar-free" products on social media, Yoplait continued to rely on lengthy corporate advertising approval processes. This arrogance resulted in Yoplait capturing about 10% of the Shanghai market but failing to expand significantly beyond eastern China.

By 2018, General Mills began scaling back its global operations, and Häagen-Dazs saw slowing growth in China. For the multinational giant, Yoplait China became a heavy-asset project that was costly to maintain yet difficult to abandon. The parent company prioritized a strong financial statement over long-term brand building, leading to Yoplait being put on the selling block.

In 2019, TIAN TU CAPITAL took over Yoplait China. This acquisition was seen as a landmark move in TIAN TU’s transition from financial investing to控股型投资 (controlling stake investments). The firm’s then-leader, Wang Yonghua, envisioned identifying consumer sectors with anti-cyclic potential and revitalizing them through resource integration and management enhancement. He brought on board Zhu Xi, former president of General Mills Greater China, as a partner, effectively performing "surgery" on Yoplait China.

TIAN TU’s acquisition price was highly favorable, with an initial cost of only about 300 million yuan, according to later disclosures. Over the next six years, TIAN TU managed to revitalize the brand.

TIAN TU’s strategy involved de-internationalizing Yoplait and making it more local. Instead of clinging to the high-priced yogurt segment, the company expanded the product line to include low-temperature fresh milk, ice cream, and even yogurt smoothies. Distribution channels were broadened from premium supermarkets to include convenience stores and e-commerce platforms.

The results initially appeared promising. In 2023, Yoplait China achieved a historic turnaround to profitability. By 2024, revenue reached 810 million yuan, with net profit after tax growing to 95.45 million yuan—a near-miracle in the low-margin dairy industry.

However, TIAN TU CAPITAL, listed in Hong Kong, has faced significant financial challenges over the past two years. In 2023 and 2024, the firm reported net losses attributable to shareholders of -873 million yuan and -891 million yuan, respectively. Concurrently, TIAN TU’s investment funds, such as TIAN TU Xingpeng, faced pressure to exit investments amid tight deadlines.

Limited partners have limited patience. They prioritize cash returns over paper gains from affiliated companies. Despite Yoplait China’s peak performance, TIAN TU was forced to sell—a move often politely termed "locking in returns" but widely seen as a necessary measure to raise urgent capital.

Calculations show that TIAN TU entered with a 300 million yuan investment and exited with 1.565 billion yuan, netting a profit of 516 million yuan over six years from its 45.22% stake. While this represents a successful exit, given TIAN TU’s depressed market valuation of around 1.8 billion Hong Kong dollars, the proceeds are seen as a lifeline.

IDG Capital’s decision to enter now comes as China’s yogurt market has undergone significant changes. Around the time of this ownership change, Blueglass, a premium yogurt brand, saw a dramatic collapse. Its product, originally priced at 49 yuan per cup, was discounted to 22.9 yuan on delivery platforms by late 2025, stripping away the last veneer of premium pricing in the segment.

The consumption logic of the middle class has shifted. After years of adjusted expectations, consumers now recognize that claims of "French slow fermentation" or "imported fruit pieces" offer little competitive advantage in an increasingly saturated market.

When Yili’s Changyou sells for 5.6 yuan per 250 grams and Mengniu’s Daily Fresh Cheese costs as little as 2.6 yuan per 100 grams, Yoplait’s 6.3 yuan per 135-gram cup appears increasingly uncompetitive.

Over the past decade, premium yogurt valuations were built on "identity consumption." Drinking Blueglass or Yoplait was seen as a badge of middle-class lifestyle. By 2026, however, consumers focus more on protein content, sugar levels, and affordability—even if the product is used as an ingredient in Luckin Coffee.

The entire low-temperature dairy industry is shifting from "brand premium" to "efficiency competition." Nielsen data confirms this trend: overall dairy sales declined in 2024, while regional brands and private labels emphasizing value saw growth.

In this context, Yoplait’s growth potential as a purely consumer-facing brand appears limited. It needs a new narrative—one that TIAN TU could not provide.

If Yoplait China is a declining yogurt brand, why would IDG spend 1.8 billion yuan to acquire it? The answer may lie not in the yogurt cup but in IDG’s broader investment strategy.

As one of China’s earliest private equity firms, IDG has made systematic investments in the consumer sector, backing brands like Heytea, Luckin Coffee, and Three Squirrels. For IDG, Yoplait’s most valuable asset is not the 60-year-old French brand but the modern factory in Kunshan, capable of producing billions of yuan worth of dairy products annually.

This aligns with a "supply chain synergy" approach. In the competitive new tea and coffee segments, high-quality base ingredients like yogurt, thick milk, and fresh milk are essential. Brands like Luckin and Heytea are actively seeking reliable dairy suppliers globally to ensure stable supply chains.

By acquiring Yoplait China, IDG is effectively securing critical cold-chain infrastructure for its consumer empire.

First, the business-to-business market offers far greater potential than direct consumer sales. If Yoplait becomes a supplier to Luckin or Heytea, its annual revenue could potentially double from the current 8 billion yuan. This B2B2C approach is more viable than competing directly with giants like Yili and Mengniu on supermarket shelves.

Second, IDG’s resources in southern and northern China can help Yoplait break out of its eastern China stronghold and reach untapped lower-tier markets.

Finally, this acquisition is a bet on "valuation reshaping." The trend of multinational brands spinning off their China operations—as seen with Starbucks bringing in local capital and McDonald’s China changing ownership—signals that local management and私募股权 (private equity) oversight can unlock greater profitability.

IDG is acquiring a stable, profit-generating asset with established infrastructure and mature management. For an experienced firm like IDG, buying a heavy-asset project at a market low is far more prudent than investing in a pre-revenue startup during a bubble.

For Yoplait, the marathon is only halfway run.