China Agri-Industries to go private for up to $1.2 billion
China Agri-Industries Holdings Ltd’s parent company will be taken private in a deal worth around HK$9.17 billion according to a filing that was published on Thursday.
According to the trading arm of the Chinese state-owned food group COFCO, the cancellation price was HK$4.25 which was 34.1% higher than the last closing price.
Shares of the company opened up 27% after they resumed trading on Thursday. They have been suspended since Monday.
If no outstanding share options were exercised, the deal size would be lowered to HK$8.9 billion, the filing said.
The reason for the privatization was that the underperformance of the company's share price had restricted its ability to raise funds from the capital market to finance its business development.
The underperformance was due to uncertainty over the company's development brought about by the slowdown of global economic growth, trade tensions and heightening of geopolitical risks.
China Agri-Industries's parent said it intended to finance the entire take-private plan with either internal cash resources or other financing, or a combination of both.
China cuts benchmark lending rate to support virus-hit economy20.02.2020
S&P and Nasdaq close on record gains amid hopes on new China stimulus18.02.2020
Alibaba extends help to firms hit by coronavirus spread, offers $2.86 billion in loans17.02.2020
Asian shares inch up to three-week highs on China’s support measures