Wilmar to take over Goodman Fielder for US$180 million

MAINBOARD-LISTED agri-business group Wilmar International is consolidating its stake in food manufacturer and distributor Goodman Fielder under a share purchase agreement inked on Monday.

Wilmar will pay US$180 million for a 50 per cent interest in Goodman Fielder holding company FPW Singapore Holdings, in a deal with a subsidiary of Hong Kong-listed Oceanica Developments.

It will also take over US$95 million in shareholder loans made by Oceanica to an FPW subsidiary, and may pay Oceanica another US$50 million after 2020 if Goodman Fielder meets certain earnings targets.

The performance of the Goodman Fielder group can be significantly improved if it comes under Wilmar's full ownership and management, argued Wilmar, in giving the rationale for the transaction.

It said that the value of the acquisition - which is still subject to certain conditions being met, such as gaining the relevant regulatory approval - was reached based on a valuation of the Goodman Fielder group and with the outstanding shareholder loans taken into account.

Wilmar will pay for the deal with internal resources and does not expect the transaction to have a material impact on consolidated net tangible assets and earnings per share for the year to Dec 31, 2019.

The counter closed at S$3.20, up S$0.01 or 0.31 per cent, before the announcement.