COFCO (Hong Kong) is seeking to privatise China Agri-Industries Holdings, the Beijing-based business in which the meat processor holds a majority stake, and withdraw the company’s listing.
The deal, announced on 27 November, will be conducted via a so-called scheme of arrangement in which scheme shareholders, who own 39.25% of China Agri-Industries, will be offered HKD4.25 (US$0.54) a share, according to a filing with the Hong Kong stock exchange.
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Of the more than 5.26 billion shares outstanding, scheme holders possess 2.06 billion shares equal to the 39.25%, with the offer price representing a 34.07% premium over a recent closing market price of HKD3.17.
COFCO (Hong Kong) already indirectly owns 60.75% of the business. Its wholly-owned subsidiary Wide Smart holds 59.88%, with another 0.86% in the hands of another subsidiary, Jumbo. A relative of a COFCO director, Song Liang, owns the remainder.
On completion of the scheme, Wide Smart and Jumbo would be the principal owners of China Agri-Industries.
COFCO said the maximum amount of cash required for the proposal equates to HKD8.9bn, taking into account the option offer on the table.
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