China Kangda Food Company announces possible acquisition

DUAL-listed China Kangda Food Company Limited's wholly-owned subsidiary has entered into a framework agreement to acquire a company engaged in the retail pharmaceutical business in Qingdao, China.

In a Singapore Exchange filing, the poultry processing company said that the preliminary consideration for the possible acquisition is 30 million yuan (S$6.2 million).

"The purchaser will only proceed with the possible acquisition if certain condition precedents under the framework agreement are fulfilled, including but not limited to the due diligence results of the target company being satisfactory to the purchaser. If the possible acquisition materialises, a legally binding formal agreement will be entered into and the target company will become a subsidiary of the company," China Kangda Food said.

On the reasons for the proposed acquisition, the company said that it will allow the group to extend into the retail healthcare and/or pharmaceutical industry, "thereby (strengthening) the existing sales channels of the group, which is in line with the long-term strategy of the company".

China Kangda Food's home exchange is the Stock Exchange of Hong Kong and it is listed on the mainboard of SGX.

It last traded on Sept 4 and closed at S$0.29.