Global investment firm Kohlberg Kravis & Roberts (KKR), international alternative asset fund manager CDH China Management Company and China-based milk producer Modern Dairy have announced the formation of a joint venture designed to deliver raw milk to Chinese consumers. Under the agreement, KKR, CDH and Modern Dairy will invest US$140 million over the next 18 months to build two new 10,000 cow dairy farms in China’s Shangdong province.  KKR, CDH and Modern Dairy will hold 61.5 percent, 20.5 percent and 18.0 percent stakes, respectively. KKR and CDH previously invested in Modern Dairy in 2008. The transaction, which is structured through KKR’s China Growth Fund, is subject to customary approvals and is expected to close in the fourth quarter.