Foreland Fabrictech Holdings to buy food processing business for S$2.3m

CHINESE textile supplier Foreland Fabrictech Holdings said it has on Thursday entered into an equity transfer agreement and confirmation agreement with Lin Yungong and Lin Wuqun in relation to the proposed acquisition of Liancheng Lianxiangyuan from the latter for 11.1 million yuan (S$2.3 million).

The purchase amount is to be paid within three months after the completion of the acquisition, the company said in a filing with the bourse operator.

It will be funded through a combination of internal sources of funds, bank or other external borrowings, or further fundraising exercises, depending on the opportunities available and the then financial condition of the group, said Foreland Fabrictech.

"The proposed acquisition will give the group a strategic exposure and entry into the food processing business and enable the group to leverage on the target's track record, expertise, existing business contacts and licences to enter into the food processing business," said Foreland Fabrictech.

It added that with net profits of 5.9 million yuan and 7.2 million yuan for FY2015 and FY2016 respectively, Fujian-based Liancheng Lianxiangyuan is an attractive investment for the group.