JAKARTA -- Indonesian tycoon Anthoni Salim's bid to turn Singapore-listed China Minzhong Food back to private hands is proceeding smoothly with Friday's approval of a plan for Indofood Sukses Makmur -- the Chinese vegetable processor's largest shareholder -- to sell its entire stake.
"Indofood obtained approval from independent shareholders on the proposed divestment of Indofood's shares in China Minzhong Food," Indofood Corporate Secretary Elly Putranti said in a statement.
The Indonesian food company will sell its 82.88% stake in China Minzhong for 651.9 million Singapore dollars consisting of cash and bonds that can be exchanged for China Minzhong shares. Indofood had said it intends to maintain a 29.94% stake in the vegetable processor.
Marvellous Glory Holdings, an investment vehicle incorporated in the British Virgin Islands and controlled by Salim, has the "firm intention" to take over China Minzhong, according to a document published Friday on the Chinese company's website.
Marvellous "intends to privatize the company and does not intend to preserve the listing status of the company," the document said. The deal will provide Marvellous and China Minzhong "greater control and management flexibility in the implementation of any strategic initiatives and/or operational changes" of China Minzhong and its subsidiaries, it also said.
Based in Fujian Province, China Minzhong produces and sells fresh and processed vegetables. The company has seen earnings decline in 2015 due to weakness in China's economy. Salim Group, meanwhile, has been keen on acquisitions and partnerships to build up its core food business, which is currently centered on Indofood, one of the world's largest producers of instant noodles.
Indofood will receive 416.4 million Singapore dollars ($298 million) in cash and S$235.5 million in exchangeable bonds from the deal -- which values China Minzhong at S$786.5 million.
Indofood's shares rose 1.45% to 8,725 rupiah on Friday, outperforming the benchmark Jakarta Composite Index's 0.1% increase.