In a filing with Bursa Malaysia, Country View said that the acquisition
KUALA LUMPUR: XingHe Holdings Bhd is exploring a new source of revenue via the RM100mil acquisition of an aquaculture business in Kg Wakuba, Sabah.
In a filing with the stock exchange today, the edible oils producer said China's campaign against environmental pollution in the northern region of the country had negatively impacted its operations.
"Due to directives by the local authorities in PRC to industrial plants including the Group’s plant to restrict production so as to improve air quality, the Group’s plant had been unable to run its production for a reasonable amount of time to fulfil sales orders.
"These production curbs have resulted in the Group not being able to accept new orders for its products and consequently, the Group’s revenue has been on a downtrend since August 2016," it said.
According to the filing, XingHe subsidiary XW Aquaculture Sdn Bhd has entered an agreement to acquire a 97.9-hectare tract and farm assets from Pegagau Aquaculture Sdn Bhd for RM100mil cash.
The land in question, valued at RM12.5mil, is located in Kg Wakuba in Sabah for the cultivation of aquaculture products.
The farm assets, to be acquired for RM87.5mil, will comprise cultivation and reservoir ponds, building and structures, plant and machinery equipment, motor vehicles and livestock and consummables.
XingHe said the acquisition is to be funded via internally generated funds, borrowing or debt to be raised from fundraising exercises.
Under the stipulated terms, the acquisition shall be completed within six months of the agreement.
Pegagau was incorporated on Sept 8, 2000, and is principally involved in the cultivation and marketing of aquaculture products.
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