PURCHASE, N.Y. — PepsiCo, Inc. is acquiring a major stake in Natural Food International Holding Ltd., a natural foods company based in Shenzhen, China, in a transaction valued at $131 million.

Natural Food, through its subsidiaries, manufactures and sells grain, nut and berry food products with a focus on grain-based premium nutrition powder. It is China’s second largest natural food producer by retail sales and offers products under the Wugu Mofang (五谷磨房) brand. The company said PepsiCo struck a deal to purchase 25.85% of the business, equivalent to 566.6 million shares, at a price of HK$1.80 per share.

Ram Krishnan, chief executive officer of PepsiCo Greater China, told Chinese newspaper The Global Times that Natural Food International has a strong growth and profitability track record.

“Our investment marks an important step in our commitment to grow 'in China, for China,’” he said.

PepsiCo also recently expanded into Africa with the acquisition of South Africa’s Pioneer Food Group for $1.7 billion.

Following the announcement, Natural Food shares surged more than 10% to HK$2.03 per share in trading on the Hong Kong Exchange.

The transaction is expected to close July 30 and would make PepsiCo the company’s second largest shareholder after Natural Capital Holding Ltd., which holds a 42.4% stake, according to Bloomberg. Natural Capital is among shareholders selling shares to PepsiCo, and its stake would be reduced to 33.5% following the transaction.

Between fiscal years 2015 and 2018 annual sales of Natural Food International approximately doubled to HK$1.8 billion ($230 million).