The Carlyle Group said that the US private equity giant had bought a minority stake in Yashili to help the leading Chinese infant formula maker improve its production.

Washington-based Carlyle obtained a 17.3 per cent stake in Yashili, headquartered in the southern Chinese province of Guangdong, according to a statement from Carlyle.

Carlyle's deal came after rivals including Kohlberg Kravis Roberts, Sequoia Capital and other funds invested more than $1 billion combined in China's domestic dairy industry, which was badly hit by a food safety scandal last year.

The deal signified the growing interest of global private equity funds in China's consumer sector despite the international financial crisis.

More than a dozen Chinese dairy firms were found to have sold milk containing melamine during last year's tainted milk scandal, putting the Chinese government under pressure as families questioned poor quality controls.

With foreign investors buying stakes in Chinese dairy makers in the past few months, officials said the domestic dairy industry had shown opportunities for growth again.