Dukang Distillers

Dukang Distillers: SGX fillings has revealed that Dukang Distillers, Mr Gao Feng has sold off his entire shareholders in Dukang to 2 entities, the first being a 14.34% stake sale to Kai Feng Teng Mills and the second a 29.5% stake sale to Treasure Winner Holdings. (Note that this is just off the 30% make to trigger a general takeover offer) Interesting to note is that Treasure Winner Holdings is wholly owned by Wang Peng, who is also the Deputy Executive Chairman and CEO of SGX listed Synear holdings who is currently undergoing a proposed delisting. Recall in April, Maybank-KE had a report out on a potential list of priviztaion plays, where Dukang was featured as a potential candidate. See the repost below: Dukang could be privatised for the following reasons: 1) Cheap valuation: which is very undemanding to us especially when compared with other A-share listed peers. 2) In Luoyang city, investors checking out a store that sells Dukang spirits. The product banner is displayed at the top of the shelves. File photo3) Cash rich: The company has very healthy operating cash flow and is in a net cash position of CNY671m. In fact, its net cash balance accounts for 51% of the company’s total market cap. 3) The consolidation of baijiu industry. Chinese baijiu market is still quite fragmented currently but might go through a consolidation process going forward. The rich cultural value inside Dukang brand could make it a very attractive M&A target.