Source: CRI

11-18-2008 15:54

The Beijing-Based diary producer, Sanyuan Group, is to purchase 7 core plants of the scandal-turned-bankrupt Sanlu, respectively located in provinces of Hebei, Shandong and Henan, revealed a Chinese newspaper.

In a report published on Monday, the 21st Century Business Herald, a leading Chinese economic newspaper, disclosed the details of the ongoing Sanyuan-Sanlu purchasing deal. The story gave out a list of names and locations of Sanlu's seven plants Sanyuan is considering buying.

Quoting an unidentified source, the report said four out of the seven plants are based at Shijiazhuang, capital of north China's Hebei province and the headquarter of the Sanlu Group, while the rest are located in city Tangshan of Hebei, city Weifang of Shandong and city Xinxiang of Henan respectively.

All the seven plants are Sanlu's core assets, of which Sanlu took hold of 90 percent of their shares, the report said.

The plants in Tangshan, Weifang and Xinxiang, all equipped with latest production lines and technologies, are key projects in the once prosperous Sanlu Group's expansion plan in 2006.

Beijing's Sanyuan Group will also assume some debt of the Sanlu Group, which faces huge compensation after its tainted diary products scandal, but no further details on the debt issue is given.

Sanlu's assets' another bidder, Heilongjiang-based Wondersun Dairy Co. Ltd., which was said to take over one of Sanlu's plant located in Heilongjiang province in an earlier report, denied its purchase plan.

"Wondersun Dairy is not satisfied with acquiring only one plant, it is waiting and will throw out an offer again if Sanyuan and Sanlu's negotiation fails to reach an agreement." The same insider told 21st Century Business Herald.

Sanyuan sent earlier this month a team of 18 experts to Sanlu's Headquarter to find out the feasibility of the acquisition.

If the purchasing deal is finally inked, the report said, it will cost Beijing's Sanyuan Group 800 million yuan and the company will probably fund its purchases with bank loans.

Sanlu Group went bankrupt amid its melamine tainted dairy products scandal. Hundreds of babies around the country have been found suffering from kidney failures ever since a first such case was reported in northwestern Gansu province in June this year. Some babies have even died out of eating Sanlu's poisoning dairy products, according to reports.

 

Editor:Xiong Qu