Shares in Japan’s Yakult fell as much as 10 per cent following a report that France’s Danone was considering unloading its 20 per cent stake in yoghurt drinks maker.
The alliance between the two companies – dating back to 2004 – had been strained since last year after Yakult executives expressed opposition to Danone’s move to to increase its stake in the company.
The two companies called off their strategic tie-up last April, with Sumiya Hori, Yakult’s chief executive, citing “differences in corporate culture”.
Yakult shares dropped 10 per cent in early Tokyo trading, erasing the gains it had made after boosting its annual profit outlook on November 7 on the back of strong sales in China and other parts of Asia. Yakult stock closed down 6 per cent at Y6,290 on Thursday.
The fall came after Bloomberg reported that Danone had held internal discussions about a possible sale of its Yakult stake worth almost $2bn.
Both Danone and Yakult declined to comment.
Market players said the potential sale, if true, was not totally unexpected, given that relations between the two companies had soured.
“The two firms had talked about their collaboration, but there seems to have been little merit from the alliance,” said Tomohiko Ikeno, an analyst at Ace Research Institute. He added that the relationship between the two companies had always been akin to “a black box”, as Yakult had been tight-lipped about its ties with Danone.
“Yakult’s business in China and other parts of Asia is doing very well so Danone’s exit is unlikely to affect its overseas strategy,” said Mr Ikeno.
When Yakult and Danone ended their tie-up last year, Mr Hori called the move “a new step forward” and said it would strengthen the company’s “management independence”.
Yakult’s efforts to expand outside of its shrinking home market has been led by a door-to-door sales force of red uniform-clad female workers, who wheel around pushcarts carrying Yakult’s probiotic yoghurt drinks.
While a bigger stake in Yakult may have given Danone more access to the Japanese maker’s extensive networks in Asia, the world’s largest dairy producer has already expanded its presence in the region.
Danone booked stronger-than-expected third-quarter revenues on strong sales of infant formula sales in Asia. Last month, the company also pushed further into China’s dairy market with a $550m investment in Yashili, the infant formula provider.