Exclusive from 36Kr | KKR plans to acquire an 85% stake in a Chinese beverage company, speculated to be Dayao.

Author | Zhong Yixuan

Editors | Qiao Qian, Yang Xuan

36Kr has exclusively learned that KKR, a US private equity firm, intends to acquire an 85% stake in a Chinese beverage company, presumably Dayao Drinks. "This deal has been in the works for a year," an insider close to the transaction told 36Kr.

In response to this news, Dayao told 36Kr that it had no comment.

According to 36Kr, Dayao's revenue in 2024 was around several billion yuan.

Previously, there were reports that Dayao Drinks was preparing for an IPO in Hong Kong as early as the second half of 2025. From the current situation, unlike many consumer companies that rushed to go public during the good market conditions, Dayao's founding team has chosen a different path.

As an established PE firm that has grown through mergers and acquisitions, KKR is known as the "King of Wall Street Acquisitions." The industry evaluates it as "making steady moves and not telling empty stories." It is also one of the oldest and most experienced private equity investment institutions globally.

Dayao Drinks is a domestic beverage company that has experienced rapid growth in recent years. In 2014, Dayao decided to enter through the catering channel, which the "Big Two" beverage giants had always overlooked, thus opening a gap in the Chinese beverage industry.

The catering channel has always been difficult to penetrate - it is highly fragmented, and distributors even need to approach each establishment individually. Additionally, the beverage cabinet space in a catering outlet is very limited. After accounting for the standard Coke, Sprite, beer, and local strong brands, there are very few spots left for new brands.

Under these circumstances, it was not easy for Dayao to break into the catering channel. In an interview with 36Kr in 2023, Dayao mentioned that over 70% of its current sales come from the catering channel.

According to the official website, Dayao has over a thousand national distributors and millions of retail terminals, covering 31 provinces, autonomous regions, and municipalities directly under the Central Government. An entrepreneur of a beverage brand once told 36Kr that as early as 2022, Dayao's total-channel sales in a certain city in the northwest had exceeded those of Coca-Cola, successfully challenging Coke's dominance locally. "Moreover, Dayao's entry into the inner city areas was also an important turning point. It once shattered the seemingly unbreakable myth of Beibingyang in Beijing."

As for this deal, it also implies a sense of "dislocation." When the market is filled with risk-averse sentiment, KKR is making a contrarian bottom-fishing move. In the first quarter of 2025, KKR raised $30.54 billion in new capital, and its total assets under management further increased to $664 billion, a 15% year-on-year increase. KKR Co-CEO Scott Nuttall said at the earnings conference, "Since its establishment in 1976, KKR has gone through many cycles and turmoils. Based on our experience, it is precisely during such periods that some very attractive investment opportunities arise."

A KKR investor once shared how they "invest in China," with the core being to invest according to China's "industrial development stage." Historically, KKR has invested in COFCO Meat in the agricultural and food sector, NVC Lighting and Haier, which benefited from the urbanization process, and ByteDance during the mobile internet wave.

"After the pandemic, US dollar funds have hardly made any large-scale acquisitions in China. This project may signal a shift in the wind and a change in the perception of China's consumer industry," a consumer investor told 36Kr.

In 2023, when talking about its goals, Dayao said it aimed to expand to the national market in five years. However, in China, there has not yet been a successful precedent for an established soda brand to become a national brand. For Dayao, KKR's industrial resources and management capabilities may present an opportunity for it to move from the catering channel to the KA channel and transform from a regional brand to achieve its nationalization goal.