China’s Tangrenshen Group Co. Ltd has plans to acquire a majority stake in Longhua Animal Husbandry by purchasing 90 percent of its shares. Tangrenshen is using capital from 22.45 million newly issued shares at CNY11.07 (US$1.81) per share and CNY43.87 million (US$7.16 million) in cash reserves to purchase Longhua’s CNY292.5 million in shares, according to a report provided by Smart Agriculture Analytics.
Funds raised by Tangrenshen will be used to purchase a majority share in Longhua Animal Husbandry and to construct a 10,000-head pig project, a smart hog farm promotion project and a smart hog farm service project. The remaining funds will be used to cover operational expenses.
The proposed Longhua Animal Husbandry acquisition will provide a growth opportunity for Tangrenshen Group, which already has a strong presence in China. According to the WATT Global Media Top Companies Database, Tangrenshen has more than 40 subsidiaries throughout China involved in feed, farming and meat processing, including the famous Camel brand of feed. In late 2012, the company announced a plan to acquire Hemei Group in order to strengthen its presence in Shandong.
Longhua already has three hog farms. In 2014 the company produced 90,000 hogs, and it has a total annual capacity of 120,000 hogs.
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