Mumbai: Tea planter Mcleod Russel India said that it will acquire Vietnam-based Phu Ben Tea Company for $2 million.
The acquisition was carried out by Borelli Tea Holdings, the 100% subsidiary of Mcleod Russel.
“Borelli Tea Holdings has signed a term sheet with Belgium based SA SIPEF NV in this regard,” Mcleod Russel said in a filing to the Bombay Stock Exchange (BSE).
Phu Ben Tea Company is engaged in growing, manufacturing and selling of tea and produces around 4.5 million kg of tea annually in the three tea processing factories owned by it.
The filing further said that Borelli would have to arrange a bank guarantee to secure repayment of inter-company balance of $5.01 million.
“The inter-company balance would be paid by Phu Ben Tea Company within three years in equal installments at the end of 2009, 2010 and 2011,” Mcleod Russel added.
Further, the board of the company has appointed Balaji Swaminathan as an Additional Director with immediate effect.
Shares of the company were trading at Rs82.35, down 5.18% in the afternoon trade on BSE.