Zhongpin CEO makes preliminary offer to buy all outstanding shares for US$13.50 each in cash, take company private
Nevin Barich
NEW YORK
,
March 27, 2012
(Associated Press)
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Shares of Chinese food processor Zhongpin Inc. jumped 27 percent Tuesday after the company's CEO made a preliminary offer to buy out shareholders and take the company private.
Zhongpin said CEO Xianfu Zhu submitted a nonbinding proposal to buy all outstanding shares for $13.50 each in cash. The stock closed at $9.21 on Monday.
Zhu already owns nearly 18 percent of the company's stock. Based on the number of shares outstanding in the company's most recent 10-K, the deal is worth nearly $450 million.
Zhongpin's board will form a special committee of independent directors to consider the proposal. The company said it can't assure that Zhu will make a "definitive" offer outside of his current proposal.
Zhongpin processes and sells pork products, vegetables, and fruits in China. It has a distribution network in China that included more than 3,428 retail outlets at the end of last year.
The company also exports to Europe, Hong Kong, and some Asian countries.
Shares rose $2.48, or 27 percent, to $11.69 in afternoon trading.
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