RGE makes $3.35 billion offer for shares of Asian company Vinda
The company submitted an offer to acquire a 52% stake in the Chinese tissue manufacturer, currently owned by Sweden's Essity, with the transaction expected to be completed by mid-2024
Recently, Vinda International, a leading Hong Kong-based hygiene company, reported that it received an offer from Royal Golden Eagle (RGE) to acquire the paper products manufacturer for HK$26.13 billion, equivalent to US$3.35 billion.
Interest in Essity’s stake initially attracted the interest of Brazil’s Suzano, which went so far as to confirm contact with the Chinese manufacturer. Currently, in Brazil, RGE is the controller of the pulp manufacturer Bracell.
In this scenario of negotiations, RGE was one of the last two companies to enter the dispute to acquire a 52% stake in Vinda, owned by Sweden’s Essity. According to the company, the price offered is almost 150% higher than the net asset value per share of Vinda, evaluated at 9.41 Hong Kong dollars in June of this year.
According to Essity, completion of the deal is dependent on regulatory approval, including in China, but is expected to be completed by mid-2024. According to Dealogic data, the acquisition marks the third largest transaction among Hong Kong-listed companies this year.
In a statement, Singapore-based RGE said that Vinda’s two largest shareholders, Essity and Vinda founder Li Chao Wang, who own 72.63% of the company, irrevocably committed to accept the offer. Essity also confirmed acceptance of the offer in a separate statement.
POST-ACQUISITION PLANS
RGE reported that it has no plans to reshape Vinda’s operations, including redeployment of fixed assets or any other major changes to the company’s management or personnel. “Vinda’s vision is to be the first choice in Asia for high-quality hygiene products and services,” Belinda Tanoto, managing director of RGE, said in a statement.
According to the executive, RGE seeks to leverage consumer growth in Asia to “build a stronger, more efficient and sustainable business.”
Founded in 1973 by Tanoto, over the years RGE has grown into a global group of natural resource-based manufacturing companies, with businesses in various segments, including pulp and paper. Today, the group has more than US$35 billion in assets and 70,000 employees.
