France: Is Yogurt A Strategic National Industry?

France: Is Yogurt A Strategic National Industry?

Foreign companies will be bidding for a major share of France's Yoplait, the world's second-largest yogurt maker. Is this good for Yoplait? Or for France?


A 50 percent stake in the French dairy product manufacturer Yoplait, the world's second largest yogurt maker, is up for grabs following French private equity group PAI's decision to cede its shares in the company. Potential bidders in the first round of bidding, which opened Friday, are expected to include French cheese makers Bel, but also Mexican Grupo Lala and Chinese Mengniu. Les Echos editor David Barroux looks at what it would mean if this quintessentially French brand, set up by French farmers in the 1960s, ended up in Mexican or Chinese hands.

As bids start to roll in for Yoplait, it is tempting to call on private equity group PAI to exercise some "economic patriotism" and only cede its stake to a French player. Combining Yoplait's trademark little flower with Bel's Laughing Cow or Lactalis' President Camembert brand would theoretically create, after Danone, a second French heavyweight in the dairy products market.

But is yogurt such a strategic industry? Does France really need two major players in the sector? Should the authorities exert pressure not to sell to the highest bidder, but rather a party with a French passport?

Yoplait is of course a solid company. But this producer, which is half as large as Danone in the yogurt market, is not a vital asset for France. If it remains French, that would be a good thing. If it does not, it is not necessarily a bad thing either. But can we go so far as to imagine it being Chinese?

To insist on Yoplait's next key shareholder being French could actually wind up being counterproductive. Because it is outside of France where Yoplait needs to strengthen its position. It does not need to convince the French to eat yogurt, but rather the Chinese and the Latin Americans. It makes most sense to take on a market like China alongside a partner with local knowledge. Yoplait and its French employees working there will remain the experts in its field for some time to come.

On the French market, the fear that a future Mexican or Chinese owner would manufacture Yoplait products abroad or in France with Chinese milk powder is unfounded. In the ultra-fresh sector, food processors source ingredients from local suppliers, not from other side of the planet.

Obviously, for the government, when tensions arise over the price of milk, it would be harder to push a Chinese shareholder than a French one. But such reasoning is no way to build an industrial policy.

read the original article in French

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In Argentina, A Visit To World's Highest Solar Energy Park

With loans and solar panels from China, the massive solar park has been opened a year and is already powering the surrounding areas. Now the Chinese supplier is pushing for an expansion.

960,000 solar panels have been installed at the Cauchari park

Silvia Naishtat

CAUCHARI — Driving across the border with Chile into the northwest Argentine department of Susques, you may spot what looks like a black mass in the distance. Arriving at a 4,000-meter altitude in the municipality of Cauchari, what comes into view instead is an assembly of 960,000 solar panels. It is the world's highest photovoltaic (PV) park, which is also the second biggest solar energy facility in Latin America, after Mexico's Aguascalientes plant.

Spread over 800 hectares in an arid landscape, the Cauchari park has been operating for a year, and has so far turned sunshine into 315 megawatts of electricity, enough to power the local provincial capital of Jujuy through the national grid.

It has also generated some $50 million for the province, which Governor Gerardo Morales has allocated to building 239 schools.

Abundant sunshine, low temperatures

The physicist Martín Albornoz says Cauchari, which means "link to the sun," is exposed to the best solar radiation anywhere. The area has 260 days of sunshine, with no smog and relatively low temperatures, which helps keep the panels in optimal conditions.

Its construction began with a loan of more than $331 million from China's Eximbank, which allowed the purchase of panels made in Shanghai. They arrived in Buenos Aires in 2,500 containers and were later trucked a considerable distance to the site in Cauchari . This was a titanic project that required 1,200 builders and 10-ton cranes, but will save some 780,000 tons of CO2 emissions a year.

It is now run by 60 technicians. Its panels, with a 25-year guarantee, follow the sun's path and are cleaned twice a year. The plant is expected to have a service life of 40 years. Its choice of location was based on power lines traced in the 1990s to export power to Chile, now fed by the park.

Chinese engineers working in an office at the Cauchari park


Chinese want to expand

The plant belongs to the public-sector firm Jemse (Jujuy Energía y Minería), created in 2011 by the province's then governor Eduardo Fellner. Jemse's president, Felipe Albornoz, says that once Chinese credits are repaid in 20 years, Cauchari will earn the province $600 million.

The Argentine Energy ministry must now decide on the park's proposed expansion. The Chinese would pay in $200 million, which will help install 400,000 additional panels and generate enough power for the entire province of Jujuy.

The park's CEO, Guillermo Hoerth, observes that state policies are key to turning Jujuy into a green province. "We must change the production model. The world is rapidly cutting fossil fuel emissions. This is a great opportunity," Hoerth says.

The province's energy chief, Mario Pizarro, says in turn that Susques and three other provincial districts are already self-sufficient with clean energy, and three other districts would soon follow.

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