Alliance Select Foods International has suspended negotiations for the acquisition of a Vietnamese fish and rice exporter due to “some issues that need to be addressed”.
In a disclosure to the Philippine Stock Exchange, Alliance Foods spokesman Rajat Balain said the firm’s board will revisit the situation in a few weeks time to decide if the issues raised have been addressed to Alliance’s satisfaction.
Alliance , formerly Alliance Tuna International Inc, was planning to invest $13.1 million (€10.2 million) for the acquisition of a majority stake in Hiep Thanh Seafood (HTS) Joint Stock Company, a leading Vietnamese pangasius and rice exporter.
Balain said that Alliance has been conducting an extensive and thorough due diligence exercise on the target company over the last two months and the review has been completed recently.
“There are some issues that need to be addressed by HTS. They need to take corrective action before Alliance will consider investing in the company, if at all,” Balain said.
HTS is a member of Hiep Thanh Group, and is one of few Vietnamese integrated firms which own pangasius farms and feed mill processing facilities.
Alliance had intended to invest $13.1 million for a 50% plus one share stake in Hiep Thanh. Of the amount, $10.5 million (€8.2 million) would be used to buy out some current shareholders and retire debt while the balance will be used for capital expenditures to introduce higher margin value-added pangasius products.
