China Soy Sauce Maker's Shareholders Said to Explore Sale

(Bloomberg) -- Shareholders of Honworld Group Ltd. are exploring a sale of the Chinese soy sauce maker, which sells products under the “Lao Heng He” brand, people with knowledge of the matter said.

Owners are working with an adviser on a possible sale of more than 49 percent of the Hong Kong-listed firm, said the people, who asked not to be identified because the information is private. The adviser reached out to potential buyers including China’s Foshan Haitian Flavouring & Food Co. and Hong Kong’s Lee Kum Kee Co., the people said.

Honworld confirmed in a late Wednesday exchange filing that founder Chen Weizhong has appointed a financial adviser “to identify potential investors or strategic partner” for the long-term development of the company. Chen hasn’t entered into any legally binding agreement, it said.

Any deal would add to the $18.3 billion of announced acquisitions of Asia-based food companies over the last 12 months, data compiled by Bloomberg show. Japanese seasoning company Ajinomoto Co. last November sold Amoy Food Ltd., a century-old firm that makes Hong Kong’s most popular soy sauce, to Citic Capital Holdings Ltd.

Chen has pledged most of his 49 percent stake in Honworld to China Construction Bank Corp., Honworld’s latest interim report shows. Chinese tycoon Xie Zhikun owns about 13 percent.

Deliberations are at an early stage, and the shareholders of Huzhou-based firm could still decide against a sale, the people said. A representative at Lee Kum Kee didn’t respond to requests for comment, while a representative for Haitian had no immediate comment.

Shares of Honworld rose 6.9 percent Wednesday, giving the company a market value of HK$2.3 billion ($296 million). The benchmark Hang Seng Index rose 1.2 percent.

In addition to soy sauce and vinegar, Honworld’s products include Hunan-style hot sauce, cooking wine and fermented bean curd, according to its website.

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