Thai CPF to buy Bellisio in $1.08 billion deal
By Khettiya Jittapong and Manunphattr Dhanananphorn
BANGKOK (Reuters) - Thailand's Charoen Pokphand Foods Pcl (CPF) (CPF.BK: Quote) said it will acquire U.S. frozen-food producer Bellisio Parent LLC for $1.075 billion, paving the way for its entry into the world's largest food market.
The acquisition is in line with CPF's strategy to expand into high-potential markets, CEO Adirek Sripratak said in a statement.
CPF, controlled by Thailand's richest man Dhanin Chearavanont, signed a purchase agreement on Thursday with seller Bellisio Consolidated Equity, and planned to use internal cash to finance the acquisition, the statement said.
CPF shares plunged as much as 5.2 percent to a five-week low on concerns that the deal may be too expensive and could affect the company's financial position.
The company had cash or cash equivalent of 43 billion baht ($1.21 billion) at end-September, according to its financial statement.
CPF, Thailand's largest meat and feed producer with operations in 14 countries, has said it planned to expand its offerings with more value-added products to serve rising demand in new markets.
Bellisio group reported net sales of $668 million for the year ended Sept. 11.
The transaction, subject to customary closing conditions and regulatory approvals, is expected to be completed within 180 days, and will enable CPF to gain access to the North American market, it said. Continued...