Indofood may make offer for China Minzhong after Glaucus attack

China Minzhong's new industrial park in Putian. China Minzhong, the Singapore-listed vegetable processor which was accused of fraudulent accounting practices last week, may attract a takeover offer from Indonesian food giant PT Indofood Sukses M
China Minzhong's new industrial park in Putian. China Minzhong, the Singapore-listed vegetable processor which was accused of fraudulent accounting practices last week, may attract a takeover offer from Indonesian food giant PT Indofood Sukses Makmur. -- PHOTO: SINGAPORE EXCHANGE

China Minzhong, the Singapore-listed vegetable processor which was accused of fraudulent accounting practices last week, may attract a takeover offer from Indonesian food giant PT Indofood Sukses Makmur.

Minzhong received a letter on Monday morning from Indofood, informing the company that Indofood is "considering the possibility of making an offer for the company".

The offer, if made, is expected to be announced later on Monday. Minzhong, which grows vegetables in China for export to 26 countries, has requested a trading halt in its shares pending such an announcement.

A possible offer "is definitely a positive in the light of what's happened," Ms Kelly Teoh, market strategist at IG Markets, told Bloomberg. "It would give investors a sense of confidence."

The potential offer comes a day after Minzhong gave a detailed rebuttal to short-seller Glaucus Research Group, which had claimed in a report last week that Minzhong had cooked up sales and other figures leading up to its 2010 listing.

On Sunday, Minzhong released a 19-page response with a point-by-point rebuttal, and provided supporting documents to back up its accounting numbers.

Minzhong's shares have been suspended from trading since last Monday, after nearing halving in value following Glaucus' report. Its last traded price was 53 cents, down 48 per cent from the previous trading day.