Hsu Fu Chi: Requests for trading halt. Rumours is that Nestle is in talks to buy the Chinese snack and candy maker, with discussions on and off for two yrs and it still isn’t clear whether a deal will be reached. Hsu Fu Chi has a current mkt cap of $3.18b and trades at 24x P/E, with a net cash position of Rmb1.2b, with recent 3Q11 rev at Rmb1.5b and net profit of Rmb205.7m…..
We note of other concept plays that could arise, as Nestle looks to increase emerging market sales by 8-10% per year up till 2020, through possible acquisitions. Co’s which operate in the same sphere could include Super Group, which trades at 13.7xE P/E FY11.
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