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Dairy firms buy Sanlu's assets

TWO dairy companies yesterday bought back shares previously owned by Sanlu Group, the bankrupt Chinese dairy firm at the center of the melamine-contamination scandal.

The stakes were put up for sale at an auction in the northern city of Shijiazhuang, capital of Hebei Province, according to sources with the Hebei Jiahai Auction Co.

Beilande Dairy Co, a Hebei-based company, bought back 34 percent of its shares for 3.2 million yuan (US$468,000), the opening bid.

Another Hebei-based dairy company, Junlebao, paid 25 million yuan, again, the opening bid, to purchase 16.7 percent of its shares back.

"I am satisfied with the whole auction process, and it went without a hitch," said Shi Lihui, vice manager of Beilande.

Hebei Tongfu Food Co Ltd bought 60 percent of the shares in Anhui Shuang-jia Food Company that had been owned by Sanlu, for 15 million yuan.

However, Sanlu's 25 percent stake in Henan Huahuaniu Dairy group failed to attract the reserve price.

The assets of Sanlu up for auction included Sanlu's shares in four dairy plants as well as 169 of its protected trademarks and 12 patent rights.

However, the auction of trademarks and patent rights was suspended for "technical reasons," according to the auction company.

Beijing-based Sanyuan Group successfully bid 616.5 million yuan to buy Sanlu's core assets on March 4.

Sanyuan had said it would bid for other assets of Sanlu, but it issued a statement on Saturday saying: "The company has no intention of buying other bankrupt assets of the Sanlu Group at present."

Sanlu Group, which was based in Shijiazhuang, had been China's leading seller of milk powder for 15 years.


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