A bid from one the world's largest food companies is set to see control of the British brand Weetabix transferred to a Chinese company.
Shanghai firm Bright Food will take a majority 60% share of the Weetabix Food Company, placing a £1.2 billion value on the cereal giant, while current private equity owner Lion Capital will retain a 40% stake.
Northampton-based Weetabix, which also owns Alpen and Ready Brek, was founded in 1932 and was family owned until 2004 when it was bought by a Texan private equity firm.
State-backed Bright Food, which generated revenues of around £7.5 billion last year, is looking to take advantage of China's "growing appetite" for healthy foods and to drive Weetabix's growth across Asia.
Zongnan Wang, Bright Food chairman, said: "With Bright Food's strong resources and our expertise in both the Chinese and broader international markets, we are excellently placed to develop the Weetabix business."
Bright Food in 2010 considered a £2 billion deal to buy United Biscuits, the company behind Hula Hoops and Jaffa Cakes, but the talks fell through.
Weetabix Food Company, the UK's second biggest cereal manufacturer, exports to more than 80 countries, employs nearly 2,000 people and generates annual sales of more than £420 million.
The Weetabix cereal alone accounted for 7% of the UK's cereal sales, with annual figures of £100 million.
Weetabix chief executive Giles Turrell said: "While the company's focus has been on reinforcing and building on our leading position in the UK, I believe there are also substantial opportunities to further grow the business internationally, in North America, Asia and beyond."
The transaction is subject to regulatory and government approvals in China, although completion of the deal is expected in the second half of the year.