United Tractors, heavy equipment and mining contractor of Astra International subsidiary, is currently bidding for 900-megawatts (3x300) for three tender projects of coal-fired power plants worth $1.8 billion in total as the part of the company's effort in diversifying their business, a senior official from the company said on Friday (4/11). (Antara Photo/Sigid Kurniawan)
Indonesia's Indofood to Sell China Minzhong Stake for $484m
BY :EVELINE DANUBRATA
SEPTEMBER 07, 2016
Jakarta. Indonesia's Indofood Sukses Makmur will sell its entire 82.88 percent stake in vegetable processor China Minzhong Food to an investment vehicle controlled by the Indonesian firm's top executive for 651.9 million Singapore dollar ($484 million).
The deal, which was announced in a stock exchange filing on Wednesday, means Indofood has scrapped its earlier plan to sell 52.94 percent of China Minzhong to a vehicle controlled by the Singapore-listed company's senior executives.
Under the latest agreement, Marvellous Glory Holdings will pay for Indofood's entire China Minzhong stake with $416.4 million Singapore dollar in cash and the rest in bonds. Indofood will exchange the bonds for 29.94 percent of China Minzhong.
Indofood's president director Anthoni Salim indirectly owns and controls nearly 93 percent of Marvellous, which will also buy out China Minzhong's minority shareholders with the intention of privatising the company.
Despite the weak global macro-economic conditions, Indofood said it believes in the long-term prospects of China Minzhong, which processes vegetables such as champignon mushrooms and black fungus.
The Indonesian company, one of the world's biggest instant noodle makers, also said it chose to retain a reduced stake in China Minzhong due to the "possibility of realizing synergies" between their businesses.
Brokerage Maybank Kim Eng said in a note to clients on Wednesday that the move is positive for Indofood as it may lead to a lighter balance sheet, lower foreign exchange exposure and improved returns for its capital allocation.
China Minzhong shares surged as much as 20 percent to their highest in more than three years, while Indofood rose 0.9 percent.