Royal FrieslandCampina NV’s plan to sell its Friso infant nutrition brand is stalling amid valuation concerns, according to people familiar with the matter.

The Dutch food group put the divestment process on hold after bids by shortlisted suitors fell short of expecations, said the people, who asked not to be identified as the information is private. A deal could have valued Friso at as much as $2 billion, Bloomberg News reported previously.

Considerations are still ongoing and no final decision has been made, the people said. FrieslandCampina could revive the sale anytime, they added. A representative for FrieslandCampina declined to comment.

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The stalemate comes as rising interest rates and the war in Ukraine hurt global investor sentiment. Reckitt Benckiser Group Plc is struggling with the sale of its own infant nutrition unit, with only a small number of private equity funds following through with bids, Bloomberg News reported last month.

FrieslandCampina put the Friso infant formula business under strategic review last year as it pushed ahead with efforts to streamline its operations. Several private equity funds and industry players including Baring Private Equity Asia, Junlebao Dairy Group Co. and Sequoia Capital China are among those shortlisted, people familiar with the matter said in March.

Friso manufactures formula for infants and toddlers and its products are available in more than 100 countries, according to its website. Euromonitor International had forecast the global market for infant formula to expand to $59.5 billion by this year, from $54.7 billion in 2020.

Source: BNN Bloomberg

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