Recently, Japan's Daio Paper Co., Ltd. announced that it has sold part of the fixed assets of its subsidiary Elleair International China (Nantong) Co., Ltd. in Nantong, China, to Hangzhou Haoyue Industrial Co., Ltd. The transaction amount is US$38 million and will have little impact on the company's financial performance as of March 2026.
The Nantong subsidiary is mainly engaged in the production of baby diapers and feminine care products. After the transfer, Dawang will outsource the production of diapers, but brand sales will continue, so as to meet the needs of Chinese consumers more flexibly. At the same time, in Nantong Second Factory (Nantong East Factory), the production and sales of feminine hygiene products will continue to advance, and plans to build a new business model to maintain growth momentum.
In recent years, with the continuous decline in China's birth rate, the intensification of market competition, and especially the rapid rise of local brands, overseas companies like Dawang are facing huge challenges. Dawang's withdrawal from the Chinese market is part of its fifth mid-term business plan, which aims to enhance cash flow generation capabilities by optimizing its overseas hygiene products business. As early as June this year, Dawang had withdrawn from the Turkish market and sold its subsidiary to the local Evyap Group.
It is worth noting that Dawang's baby diaper brand "GOO.N" has a certain reputation in the Chinese market. The transfer of the brand to Haoyue will not only help optimize the cost structure, but also enhance market competitiveness by leveraging Haoyue's integrated advantages in raw materials and terminal products. This transaction not only marks a major adjustment in Dawang’s strategy in the Chinese market, but also reflects that the global diaper and care products industry is transforming to a light-asset model of “brand + outsourced production” to cope with the challenges brought by regional population changes and cost pressures. In the future, how Dawang will layout other markets and continue to strengthen its brand influence is still worth continuing to pay attention to.