On 7th December 2011, Nestlé’s intended purchasing 60% shares of Hsu Fu Chi by Rmb1.51bn ($234m) was cleared by MOFCOM officially. By this news, all clouds of doubt and debates from a variety of societies in last months are dispelled. In particular, Nestlé/Hsu Fu Chi decision from MOFCOM cleans up the school of worries from foreign enterprises that antitrust enforcement of PRC is inclined to protect national brand, as they derived from Coca-Cola/ Huiyuan case. It is believed that MOFCOM’s clearance in Nestlé/Hsu Fu chi must have an encouraging effect on foreign enterprises’ incentive to march into Chinese market by the means of concentration.

Without many disputes, Nestlé’s market share in Chinese confectionary market would be much higher ex post this transaction. According to the market sources, Hsu Fu Chi’s greatest strength lies in bulk sales, while Nestlé is good at package sales. It is highly anticipated that combination of Nestlé and Hsu Fu Chi would give rise to a synergy effect, hence would influence Chinese confectionary market in a significant degree.

A spokesman from Nestlé publicly expressed there would not be major changes on the company’s development direction and employee after the concentration. Nevertheless, when asked if Hsu Fu Chi has the plan to develop high-end product after Nestlé joins in, he said, there existed various possibility.