Danone has announced plans to cut its holding in Japanese probiotic dairy drink maker Yakult to around 7% from 21.3% in a move that reflects its “continued focus on disciplined capital allocation”.
Following the sale, Danone will remain Yakult's largest shareholder and will continue to sit on the group's board of directors.

Also on Wednesday, the French foods group and Yakult confirmed their commitment to a long-term strategic relationship and shared vision to promote probiotics as part of a balanced diet.

“Danone and Yakult will intensify their joint efforts to promote probiotics through the jointly created Global Probiotics Council. The parties also intend to expand the Ishoku Dogen program which aims at deepening the understanding of the link between diet and health.

“From a commercial perspective, the partners will study the feasibility of new collaboration projects such as the distribution of Yakult's products by Danone in European markets where the brand is not currently engaged in substantial business, with Spain as an initial test market.”

RBC Capital Markets said that at Yakult's current market cap, the stake being disposed of is worth around €1.6bn. “In our view, indiscriminate investment has been one of the big turn-offs of the Danone investment case since the acquisition of Numico in 2007. Consequently we regard this as a positive development,” said analyst James Edward Jones.

At 1100 GMT, Danone shares were up 0.7% to €64.32.