Australian trade firm Jatenergy Ltd. has agreed to acquire a 70% stake in Australian Natural Milk Association Pty Ltd., or ANMA, for a total consideration of A$14 million, according to an Aug. 8 release.
ANMA produces infant formula and other dairy products from its western Melbourne facility.
The acquisition will be paid with A$12 million in cash and, subject to shareholder approval, issuance of Jatenergy shares worth A$2 million.
Jatenergy said the move will secure slots for them to export infant formula and other dairy products to China. ANMA has approvals from China's Certification and Accreditation Administration, or CNCA, and the State Administration for Market Regulation, or SAMR, to export infant formula to China.
The company also announced plans to have ANMA acquire production lines for the manufacture of lactoferrin-based products. The equipment for lactoferrin production is estimated to cost around A$3 million.
In addition, Jatenergy expects ANMA to be able to produce and sell lactoferrin to other milk producers at a significant margin.
The company will hold a shareholder meeting on Sept. 24 to vote on the proposed issuance of Jatenergy shares for the acquisition. It did not provide an estimated closing date of the transaction.