CONSUMER goods company PSC Corporation : DM0 0% is proposing to acquire food manufacturers Dean Fa Food Co (Taiwan) and Novel Food Manufacturing (Singapore) for S$95.1 million.

The total consideration is expected to comprise approximately S$2.8 million in cash. The remaining S$92.3 million will be satisfied through the issuance of 219.7 million new ordinary shares in the share capital of PSC, at S$0.42 per share, PSC said in a bourse filing on Tuesday (Jun 7).

This issue price represents a premium of about 5.5 per cent over the volume-weighted average price of S$0.398 for shares traded on Jun 3.

The net asset value and book value of the sale shares, on a consolidated basis, is about S$66.7 million.

Dean Fa Suzhou, a company owned by Novel Food Manufacturing, is an established manufacturer and distributor of food products like tofu, soy milk, vegan meat and noodles, PSC said.

The proposed deal will give PSC the right to run food manufacturing and distribution operations in China. The company will also take over a manufacturing facility sitting on a 6.5-hectare plot of land, which has a remaining lease term of 39 years.

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PSC executive chairman Sam Goi said the proposed acquisition will enhance his company’s core capabilities in food manufacturing and distribution, and give it an opportunity to gain a strategic foothold in China.

The group said it will hold an extraordinary general meeting “in due course” to seek shareholders’ approval for the proposal.

PSC shares ended Tuesday 5.2 per cent or S$0.02 higher at S$0.41.

PSC was established in 1974 as Provision Suppliers Corporation, then changed its name to PSC Corporation in 2003. In 2012, the group changed its name to Hanwell Holdings. In April, it was renamed PSC Corporation, again.