Poultry producer Vitarich Corp. is expanding its business with the acquisition of Barbatos Ventures Corp. for P45 million.
Vitarich said in a disclosure to the stock exchange its board of directors approved the terms of memorandum of understanding with Luzon Agriventure Inc. to buy shares owned and held by LAVI in BVC.
BVC is engaged in poultry production, processing, raising and breeding of chickens and similar stocks. It offers various range of services from tolling, packing, cutting and storage of quality dressed chicken.
Vitarich said the acquisition would provide the company additional source of income and cost savings, with minimal impact on cashflow.
“It is also consonant to Vitarich’s plan for improving and ramping up production of dressed chicken and other products for its hotel, restaurant and institutions clientele,” the company said.
Under the MOU, the transaction will be subject to prior due diligence and fairness opinion and compliance with Securities and Exchange Commission and Philippine Stock Exchange regulations for related party transactions.
The actual value of the transaction will still depend on the actual appraisal of the business, but the acquisition cost was capped at P45 million.
The amount will also be payable in installments over three years from 2022 to 2024.
“Should the conditions be fully satisfied and the acquisition of BVC shares eventually materialize, BVC will become a subsidiary of Vitarich.
The share price of Vitarich rose 2.67 percent Thursday to close at P0.77.