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Japfa buys remaining 15% of Myanmar business for US$5.7m

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JCMA, which runs a vertically integrated poultry business ranging from feedmills, poultry breeding farms and hatcheries, to commercial and contract farms, had net assets of US$19.5 million as at Sept 30, 2014, according to Japfa.

MAINBOARD-LISTED agri-food company Japfa on Monday said it has acquired the remaining 15 per cent of Japfa Comfeed Myanmar (JCMA) for US$5.7 million, making JCMA a wholly-owned subsidiary of the group.

The acquisition is made via a conditional share purchase agreement (SPA) between Japfa's wholly-owned subsidiary Japfa Myanmar JV - which currently holds 85 per cent of JCMA - and Best Livestock Limited, an unrelated third party, for the remaining 15 per cent of the issued share capital of JCMA.

The US$5.7 million consideration was arrived at on a willing-buyer, willing-seller basis, said Japfa. A refundable deposit of US$1.0 million will be paid around Feb 2, and the remaining US$4.7 million will be paid upon completion of the SPA, after all conditions precedent have been satisfied, the primary condition being the approval of the Myanmar Investment Commission.

JCMA, which runs a vertically integrated poultry business ranging from feedmills, poultry breeding farms and hatcheries, to commercial and contract farms, had net assets of US$19.5 million as at Sept 30, 2014, according to Japfa.

sentifi.com

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"A change in the Myanmar regulations has created an opportunity for the group to fully own its Myanmar operations and reap the full benefits of this fast-growing poultry market. By replicating our Indonesian poultry business model, we now enjoy a first-mover advantage and hold a leading market position for poultry in Myanmar," said Tan Yong Nang, chief executive officer of Japfa.

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