Hsu Fu Chi Will Be A Strong Fit For Nestlé's EM Ambitions

Swiss food giant Nestlé is reportedly in talks to acquire Chinese snack and candy producer Hsu Fu Chi. From a strategic point of view, the acquisition would make sense for Nestlé as the company seeks to beef up its presence in emerging markets (EMs), particularly in China. While Hsu Fu Chi is also rumoured to be in talks with other companies, we believe Nestlé is in a strong position to ward off the competition from other contenders given its massive financial clout and considerable cash pile. Should Nestlé decide to acquire Hsu Fu Chi, however, there is always the chance that the Swiss food giant may encounter regulatory scrutiny from the Chinese government, which could frustrate its efforts to expand in the country.

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