(Yicai Global) Nov. 15 -- New Hope Liuhe plans to buy out two pig breeders for CNY985 million (USD140 million), even with the significant increase in pig sales and prices, the Beijing-based agricultural and stock-raising company announced yesterday.
The firm will buy all of a sub-subsidiary of Sanquan Food based in Zhengzhou, the capital of China's east-central Henan province for CNY135 million. The firm's large production facility housing 45,000 sows that slaughters about 11 million hogs each year will boost the company's feed sales by 300,000 tons each year, it projects.
New Hope Liuhe will also take over Yantai Fuzu Food's unit in Laiying in eastern Shandong province, which runs nine pig farms and one feed plant, for CNY850 million. The target firm is expected to rear 800,000 pigs each year in full production, boosting annual feed sales by 250,000 tons, according to New Hope Liuhe's projection.
New Hope Liuhe shares [SHE:000876] closed 4.13 percent down at CNY21.33 (USD3) at lunch today.
Formed in 1998, the company, whose business is feed, poultry and pig breeding, registered CNY1.7 billion (USD243 million) in net profits last year, down 25.2 percent from a year earlier, based on an operating revenue of CNY69 billion, an annual growth of 10.4 percent, according to its annual report for last year. The firm was among the top four among its listed industry peers per number of pigs slaughtered last year.
Editor: Ben Armour