[ET Net News Agency, 24 October 2017] China Agri-Industries (00606) said it agreed to
sell to ultimate controlling shareholder COFCO Corporation biofuel and biochemical
business at HK$8,579 million.
It is estimated that there would be a one-off unaudited gain of about HK$1,090 million
from the disposal.
The net proceeds will be used to finance future development in the grain and edible oil
processing and branded consumer business; partially repay certain bank borrowings to
optimise capital structure; and distribute a special dividend of HK$0.2 to HK$0.3 per
share, totaling around HK$1 billion to HK$1.6 billion, to the shareholders (subject to the
decision of the Board). Remaining proceeds from the disposal, if any, will be retained for
working capital purposes.
The biofuel business includes the production and sale of corn-based fuel ethanol as well
as other corn-based products, such as consumable ethanol, anhydrous ethanol, feed
ingredients (including dried distiller's grain with solubles (or DDGS)), crude corn oil
and others. The biochemical business includes the production and sale of corn starch, corn
sweeteners, monosodium glutamate (MSG), feed ingredients, crude corn oil and others. (HL)