Bay of Plenty-based honey and health products company Comvita has signed a 51-49 joint venture with its long-term distributor in China, Shenzhen Comvita Natural Food Co. (SCNF).
Comvita's stake will be acquired by issuing 2.83 million shares at $10.60 per share, valuing its stake at $30 million. On completion, the family of Zhu Guangping, SCNF's controlling shareholder, will own 10.07 per cent of Comvita, up from just over five per cent.
"SCNF has worked with Comvita for more than 12 years and the relationship is very strong, beginning with just two staff and now employing more than 200 staff throughout China," said Comvita chief executive Scott Coulter.
The SCNF-Comvita business has experienced a compound annual growth rate of 30 per cent since 2004 and Chinese customers ultimately consume approximately 60 per cent of Comvita's total sales, whether in China, or via tourists in Australasia, Hong Kong or other parts of the world, he said.
Comvita chairman Neil Craig said forming the joint venture had been a longterm objective, and the structure had been under discussion for 12 months.