KEY POINTS:
Natural healthcare products company Comvita has bought its Hong Kong distributor GreenLife for $9.03 million in shares and cash.
The move is set to take effect from May 1 and is subject to final due diligence and shareholder approval.
Comvita expects the purchase will have a positive impact on its gross margins and earnings per share.
The New Zealand company will pay $2.2 million in cash and make up the balance with shares at 5 per cent below the current market price.
Comvita's chairman, Neil Craig, said the acquisition would enhance growth into neighbouring China and other Asian markets. It would take Comvita closer to its end consumers.
"GreenLife's proven track record and its distribution capability, retail stores, network of sales staff and in-store promoters give us the ability to do just that and launch new products into the Asian market quickly and efficiently."
Comvita has an annual turnover of $7.6 million. Its shares closed down 1c yesterday at $3.80.
- NZPA
