Source: MEATINGPLACE, 8/26/16

China’s WH Group Ltd., parent of Smithfield Foods Inc., said CDH Investments plans to sell about one-third of its holdings in the company for a potential $1.19 billion, below the shares’ initial public offering price, the Financial Times reported from Hong Kong.

WH Group bought Smithfield in 2013, then launched an IPO on the Hong Kong Stock Exchange that was smaller than first anticipated, derailing plans by CDH and other investors to cash out at the time.

CDH is one of the longest-running Chinese private equity funds, formed in 2002, and the difficulties in launching the WH Group listing were considered an embarrassment for Hong Kong’s investment banking community, the Financial Times reported.

CDH said it plans to sell a 10.61 percent stake in WH Group at a share price of HK$5.95 a share, below the HK$6.20 price at the IPO, for a loss of $50 million, according to the article.

The $7 billion purchase of Smithfield by WH Group, formerly Shuanghui International, is the largest takeover of a U.S. company by a Chinese company.

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