China Business Blog - Aggregated China Business Blogs
Aggregated China Business Blogs
Huiyuan to buy unit from its chairman
Aggregated Source: Shanghai Daily: Business

CHINA Huiyuan Juice Group Ltd, the nation's biggest juice maker by market share, said it will buy a concentrates-and-puree maker from its chairman for HK$3.42 billion (US$440 million) in new stock.

Huiyuan will issue 447.3 million new common shares and 655.3 million in new convertible preferred shares to a company owned by Chairman Zhu Xinli, according to a Hong Kong stock exchange filing.

The Beijing-based juice maker said it will also assume HK$1.52 billion of debt. Huiyuan fell 4.3 percent, the biggest drop in more than a month, to close at HK$3.13 yesterday.

Huiyuan had net debt of 3.2 billion yuan (US$522 million) as of December, according to Bloomberg News data.

Huiyuan has attributed a decline in earnings to pressure from China's slowing economy and consumer concerns about food-safety issues. Last year profit sank 95 percent to 16.2 million yuan, the company said in March.

The target company, China Huiyuan Industry Holding Ltd, had a profit of 358 million yuan last year and 275 million yuan in 2011.

The purchase "secures long-term access to key raw materials," Huiyuan said in the filing.

Original URL: Click here to visit original article
Copyright Shanghai Daily: Business