Chinese confectioner Hsu Fu Chi International Ltd announced yesterday that China's Ministry of Commerce has approved Nestle's planned $1.7 billion acquisition of 60 percent of the company.

After the buyout, the Hsu family, who founded the Guangdong-based company, will indirectly hold the remaining 40 percent stake in Hsu Fu Chi. Current CEO and Chairman Hsu Chen will continue to lead the company.

Nestle plans to delist Hsu Fu Chi from the Singapore Exchange, Hsu Fu Chi said.

"Our independent shareholders have voted in favor of the delisting," Hsu Fu Chi spokeswoman Sun Tianzhen told the Global Times yesterday.

The acquisition is a win-win deal for both parties, Yan Qiang, a food analyst and partner at Adfaith Management Consulting, told the Global Times yesterday. "Hsu Fu Chi can offer Nestle its big market share and wide coverage in second- and third-tier cities. And Nestle is the best partner for Hsu Fu Chi to become a global brand, with sufficient capital and R&D capacity."

Hsu Fu Chi ranked the third largest confectioner in China last year, with a 3.9 percent share of the market, and Nestle was the fifth largest, with a market share of 1.8 percent, according to the market research company Euromonitor.

There has been a series of foreign acquisitions, especially in China's food industry, recently.

US fast-food giant Yum! Brands Inc's acquisition of Chinese hotpot chain Little Sheep Catering Chain Co was approved in early November and Nestle's acquisition of a 60 percent stake in Chinese food company Yinlu Foods Group was also approved earlier this month.

"Mergers and acquisitions are a normal and inevitable trend, so it's not necessary to reject them," He Manqing, director and researcher at the Center of Transnational Corporation under the Research Institute of the Ministry of Commerce, told the Global Times yesterday.