Ellerston-backed baby food firm Bubs clinches China deal [IMG]...

Ellerston-backed baby food firm Bubs clinches China deal


Australian baby formula is a big seller in China. Picture: John Appleyard

• The Australian
• 12:00AM June 9, 2017
• 

The infant formula and organic baby food company backed by Ellerston Capital and Chinese entrepreneur Albert Tse will launch a big push into mother-and-baby stores across China after securing a distribution agreement with a Shanghai-based Chinese partner.
Bubs Australia has secured an agreement with Brilite Nutritionals as its exclusive partner and an authorised distributor in China, with a primary focus on mother-and-baby stores.
The deal will see Bubs, which is also bankrolled by Chinese internet celebrity and the wife of the founder of e-commerce giant JD.com, Zhang “Nancy” Zetian, sell its products through over 2000 mother-and-baby stores across China.
Brilite already has a strong physical presence in the Chinese infant formula market.
“The majority of baby food and baby cereals sales are through the mother-and-baby channel,’’ said Nicholas Simms, who was yesterday formally appointed as Bubs CEO. He was previously the firm’s commercial director for infant milk formula.
“We have always wanted to run our own race and create our own end-user demand in China. This is a bit of a watershed moment for Bubs.’’
He said the move would also help Bubs secure regulatory approval for its infant formula products under new regulations taking force next year.
The Bubs strategy is in contrast to rival a2 Milk, which has so far focused on selling its products through daigou traders and cross-border e-commerce channels into China, but says the mother-and-baby store category is a growing part of its focus.
A2 this week extended the responsibilities of its Australasian boss Peter Nathan to China.
Bubs listed on the ASX in January in an IPO backed by a $200m private equity fund called Wattle Hill, established last year by Chinese entrepreneur Albert Tse, the husband of former prime minister Kevin Rudd’s daughter Jessica Rudd.
Ms Zetian’s investment company also has a 17.3 per cent stake in Bubs.