PETALING JAYA: Rhone Ma Holdings Bhd, which is currently in the business of animal health services as well as the manufacturing and distribution of animal health products, is targeting to venture into the fresh milk production business.
In a filing with Bursa Malaysia yesterday, the company said it is expecting to complete the acquisitions of three companies by this quarter for a total of RM7.8mil.
Rhone Ma said the acquisition will allow the group to venture into dairy farming.
In February, Rhone Ma announced the acquisition of non-controlling 49% stakes in One Lazuli Sdn Bhd, Nor Lazuli Nutrition Sdn Bhd and Nor Livestock Farm Sdn Bhd (NLF).
The acquisition will be financed through funds raised by issuing new shares through rights issues and cash.
“The board anticipates that, barring any unforeseen circumstances, the group’s new business may contribute to 25% or more of the net profits or net assets of Rhone Ma moving forward, ” the company said.
For the diversification, Rhone Ma would need to seek the approval from its shareholders.
The company said NLF is operating a dairy cow farm supplying fresh milk to wholesalers in Batang Kali, Selangor with its farm over 6.07 acres.
It said that NLF has ordered 100 cows for about A$425,000 (RM1.19mil), which would be arriving in Malaysia by the end of June 2020.
The purchase consideration was funded by an internally generated fund.
“The proposed diversification allows the group to venture into dairy farming and ultimately, production of fresh milk which serves as an opportunity for the group to create a new revenue stream, ” it said.
Rhone Ma said NLF has been involved in the business of dairy farming since 2014, which will grant the group with knowledge in the new business as well as immediate access to the local market.
“Leveraging on the group’s business activities, it intends to capture a wider spectrum of the livestock-related business and plan to diversify the business activities to include the business of manufacturing, wholesale and distribution of livestock feed and other related products and operating a dairy cow farm to supply fresh milk, ” it said.