The Southern United Property Rights Trading Center recently published information that 19.73% of the equity of Guangdong Yantang Dairy Co., Ltd., the largest dairy production and processing enterprise in South China, is proposed to be listed for sale, with a listing price of 72.748 million yuan.

The transferor was Guangdong Yantang Investment Co., Ltd. Prior to the transfer, Guangdong Yantang Investment Co., Ltd. held 83.73% of the shares of Guangdong Yantang Dairy Co., Ltd., and Guangdong Yuelu Investment Co., Ltd. held 16.27% of the shares. Yantang Investment said that in order to further adjust the industrial structure, take advantage of strategic investors' advantages in capital, industrial strength, technology, management and marketing, and provide long-term effective incentives for management, Yantang Investment intends to pass the open market. The company transferred 19.73% equity of Yantang Dairy, and introduced strategic investors and some Yantang dairy management members to hold shares. The equity transfer plan has been approved by the Ministry of Agriculture. After the equity transfer, Yantang Investment still holds a 64% equity interest in Yantang Dairy, which does not change its controlling position in Yantang Dairy.

Analysts believe that the Yantang dairy industry is paving the way for its listing. It is reported that as early as 2008, the restructuring and listing of Yantang Dairy has been put on the agenda.

It is understood that Guangdong Yantang Dairy Co., Ltd. is one of the leading enterprises of Guangdong Agricultural Reclamation, with 587 employees. In 2009, the main business income was 478 million yuan and the net profit was 21.41 million yuan. In 2008, Yantang Dairy achieved a total loss of 310 million yuan and a net profit of 8.05 million yuan in the dairy industry due to the melamine crisis. As of January 31, 2010, the target value of the transfer target was 27.1044 million yuan.

For the intended transferee, the transfer announcement requires that the registered capital of the enterprise legal person incorporated in Guangzhou must reach more than 600 million yuan. The audited net assets of 2009 must have a book value of more than 600 million yuan, as of December 2009. On the 31st, the balance of its book currency funds was not less than 400 million yuan; the intended transferee must have rich experience in equity investment, and its affiliates or its related parties have successfully invested in no less than 5 A-share listed companies.
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In addition, the announcement also excludes the possibility of other dairy companies acquiring Yantang Dairy, requiring the intended transferee or its consortium not to include corporate entities that compete with Yantang Dairy Company, and to hold such enterprises. Investors with a legal personship of more than 5%.

Yantang Dairy Management will also achieve shareholding by participating in the transfer of some of the shares of the transfer. Eleven of the senior management and core technology backbones will receive a 2.5% equity interest in Yantang Dairy.