American Lorain Corp. has signed a letter of intent to acquire Shandong Greenpia Foodstuff, a manufacturer of retail-packaged, Korean-style cold dishes.
The acquisition will include a cash and stock offer of US$2.1m in cash and 731,707 shares of American Lorain common stock.
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The Chinese convenience food firm is expected to complete the equity exchange and obtain government approval on the acquisition on or before 30 September.
“We have been looking to expand our pickled vegetable and cold dish product line since we received favourable reception of the dishes from our customer base following our February 2010 launch of our own, Lorain-branded cold dishes,” said Si Chen, chairman and CEO of American Lorain.
“While developing new products in the category ourselves was a consideration, we also saw benefit to buy companies in our province that are currently producing like products,” he added.
Shandong Greenpia’s 2009 sales revenue was around $1.5m, which American Lorain said it is confident it will double once the acquisition is complete.
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