August 25, 2016 / 2:03 AM / 2 years ago

Chinese pork supplier WH Group says major investor CDH to sell 10.61 pct stake

HONG KONG, Aug 25 (Reuters) - China pork company WH Group Ltd said on Thursday a major investor, Chinese private equity firm CDH Investments, plans to sell an aggregate 10.61 percent stake in the company in placements that could raise HK$9.25 billion ($1.19 billion).

WH Group, owner of the world’s largest pork producer and processor Smithfield Foods Inc, said in a Hong Kong stock exchange filing that CDH had informed the pork firm it plans to sell an aggregate 1.55 billion shares, at HK$5.95 each. The sale will be carried out via a series of deals, including private placements to buyers that could include existing shareholders.

Shares in WH Group ended 1.5 percent up on Wednesday at HK$6.26 before the CDH plan was announced, and slid 4.5 percent early in Thursday trading to HK$5.98, marginally above the CDH placement price.

CDH’s shareholding in the Chinese pork company will be reduced to 19.77 percent from 30.39 percent on completion of the deals, WH Group said. WH Group gave no reason for the share sales among the major shareholders.

CDH officials in Hong Kong weren’t immediately available for comment.

As part of the CDH deal, another major WH Group investor Rise Grand Group Ltd will buy 292 million of the shares, raising its stake to 36.01 percent from 34.02 percent.

Thomson Reuters publication IFR on Wednesday reported part of the CDH sale plan, citing a deal marketing term sheet. ($1 = 7.7538 Hong Kong dollars) (Reporting by Donny Kwok; Editing by Kenneth Maxwell)

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