Li & Fung, the Hong Kong sourcing company that supplies clothes and toys to US retailers like Wal-Mart Stores, has agreed to sell its Asia consumer and healthcare distribution business to Dah Chong Hong Holdings (DCH) for US$350 million in cash.
The move to divest is part of Li & Fung’s three-year strategy of simplifying its overall business to drive organic growth and allow the company to focus on its core businesses of trading and logistics.
On Tuesday, Li & Fung said it had inked an agreement with locally-listed DCH over the sale of LF Asia Distribution, adding that the deal is expected to close by the end of June.
“LF Asia Distribution has more than 40 years’ history and ranks amongst the leading consumer and healthcare distributors in Greater China and Southeast Asia,” said William Fung, chairman of Li & Fung.
DCH said in a filing with the Hong Kong stock exchange on Tuesday that the acquisition would expand the firm’s consumer business.
(Source: South China Morning Post)