China Xiangtai Offers 1.75 Million Shares Held by Stockholder

The Chinese pork processing company said one of its stockholders, YA II PN, may seek to sell 1.75 million of its shares.

Belinda Zhou
    Dec 23, 2019 6:30 PM  PT
China Xiangtai Offers 1.75 Million Shares Held by Stockholder
author: Belinda Zhou   

China Xiangtai Food Co. Ltd. (Nasdaq: PLIN) is seeking a buyer for its shares worth $6.93 million currently held by a stockholder. 

The Chongqing-based company said the stockholder, YA II PN Ltd., may offer from time to time up to 1.75 million ordinary shares in PLIN that may be issued upon the conversion of convertible debentures. The shares are expected to be sold at up to $3.96 apiece. That represents a 4% downside of Monday's close, at $4.11 per share. 

China Xiangtai will not receive any proceeds from the deal, according to its filing with the U.S. Securities and Exchange Commission last week. The company, which has been publicly listed since August 2019, had 22,094,027 ordinary shares outstanding as of Dec. 18, its filing said.

The shares may be offered upon the conversion of convertible debentures issued in a private placement in November. The debentures bear interest at the rate of 5% per year.

The company said in its filing, "The conversion price will the lesser of (i) $5.06 and (ii) 93% of the four lowest daily volume weighted average prices of the Company's ordinary shares (as reported by Bloomberg) ("VWAP") during the 10 consecutive trading days immediately preceding the date of such conversion, but in no event will the conversion price be less than $3.00."

The debentures were issued by China Xiangtai Food at an aggregate principal amount of up to $5 million. The company said the proceeds from the debt issuance will be invested in general corporate and working capital or other purposes.

Operations at China Xiangtai facilities include the slaughtering, packing, distributing and wholesaling of a variety of pork meat and parts. The company also processes beef, lamb, chicken, duck and rabbit meat from local farmers.

Shares in PLIN closed 2% lower on Monday in New York.