China Mengniu Dairy Co. Ltd., one of the country's leading dairy producers, announced that it has entered a long-term strategic cooperation with European dairy giant Arla Foods on June 18.

Arla Foods will invest HK$2.2 billion ($283.6 million) for a 5.9-percent stake in Mengniu, making it the second largest strategic shareholder of Mengniu, after the China National Cereals, Oils and Foodstuffs Corp. (COFCO), the country's largest food manufacturer and trader. The deal is the largest international cooperation in China's dairy industry so far.

Arla Foods is a world leader in dairy farming, pasture management, research and development, quality management and production processes. It will be involved in Mengniu's daily operations, send professionals to work with Mengniu employees, help Mengniu update production technology and improve its management system, said Ning Gaoning, Board Chairman of COFCO.