Buyout target Cocoaland gets offer First Pacific consortium

The consortium is willing to pay MYR2.70 for all outstanding shares - a 32.4% premium on the May 29 closing price - valuing the business at approximately MYR463.3 million ($125 million). First Pacific is acting in concert with several members of the founding family of Cocoaland, including Liew Fook Meng, an executive director with the company.

As of March, Leverage Success - a vehicle controlled by the family - held a 38.04% interest in Cocoaland, while Liew owned 1.70%. Singapore-based Fraser & Neave Holdings is the second largest shareholder with 27.19%.

The Cocoaland board has agreed to enter into further discussions with the consortium, according to a filing. Last week it rejected a MYR2.20 per share offer from Navis. This followed an April announcement that Cocoaland had held preliminary discussions with EQT about the possible sale of a majority interest in the business. Fraser & Neave said in February that it was in talks with the PE firm regarding the asset.

Cocoaland was founded in the 1970s by two brothers selling deep-fried snacks and banana fritters from stalls in the Klang Valley. They moved upstream into manufacturing and distribution and made their breakthrough in the mid-1980s after identifying a market opportunity in packaged drinks. Cocoaland now produces a range of confectionary, snacks and beverages.

The business - which listed on the Bursa Malaysia in 2005 - comprises two manufacturing arms, Cocoaland Industry and B Plus Q, and four trading divisions, LB Food, Mite Food Enterprise, Lot 100 Food, and Cocoaland Retail. Turnover reached MYR260.7 million in 2014, up from MYR254.4 million the previous year. Net profit dropped slightly to MYR21.9 million from MYR22.1 million.

Hong Kong-listed First Pacific has business interests in telecommunications, consumer food products, infrastructure and natural resources. These include a 50% stake in Australasia-based food producer Goodman Fielder and a 50.1% interest in Indonesia's Indofood.

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• Topics
• Buyouts
• Consumer
• Southeast Asia
• buyout
• Southeast Asia
• Malaysia
• Navis Management
• Consumer