Shenzhen-listed agribusiness firm Tech-Bank Food has reduced its stake in pig-farming firm SciGene to 19% from 49%, according to an exchange filing.
Tongwei Agricultural Development, a subsidiary of Shanghai-listed photovoltaic new energy firm Tongwei, paid 1.65 billion yuan ($229.3 million) for the 30% stake — in a transaction that valued SciGene at 5.5 billion yuan ($764.2 million), per the filing.
Tech-Bank Food’s decision to reduce its ownership position at SciGene comes as the firm focuses on the downstream slaughter and food-processing industry.
Previously, CICC Capital, a unit of Chinese investment bank CICC; and state investor Anhui State-owned Capital Operation Holding Group had intended to invest a total of 400 million yuan ($54.8 million) into SciGene in September 2023. However, the deal does not seem to have materialised so far.
Hefei-headquartered SciGene, which was previously the pig-breeding department of Shenzhen-listed agriculture and animal husbandry firm Ningbo Tech-Bank, spun off from its parent firm in July 2022, as the pig-farming firm geared up for an initial public offering in the A-share market.
2023 was a challenging year for some of the country’s pig breeders as recent aggressive expansion of pig herds has resulted in mounting losses and rising debt amid sluggish demand, per Reuters.
Despite the challenging market conditions, SciGene recorded a 30% business growth in 2023, selling a total of 280,000 of hog that resulted in a revenue of 1.8 billion yuan ($250.1 million), the transaction’s financial advisor Firmawise Capital shared in a release on Thursday.