Foodservice products maker Fuling Global Inc. is considering a move to go private, just days after one of its subsidiaries acquired a Colorado-based company.
Total Faith Holdings Ltd., a subsidiary of Fuling Global, already had a 49 percent stake in Domo Industry Inc., a Fort Collins, Colo.-based food packaging company. Now it owns the remaining 51 percent.
Terms of that deal, which was announced June 19, were not disclosed.
Three days later, the founder and chairwoman of Wenling, China-based Fuling Global announced that she was leading a group of investors that wants to buy all of the outstanding shares of the company for $2.18 per share in cash. That represented a premium of 7 percent over the June 19 closing price for the stock.
Based on its 15.8 million outstanding shares, the offer values the company at $34.4 million.
The company, which is currently traded on the Nasdaq Stock Market, has formed a special committee to consider that offer.
Fuling Global posted 2019 net profit of $14.4 million on sales of $151.1 million. The United States is its largest market, accounting for sales of $129.6 million.
Fuling Global manufactures and distributes single-use items for the food service industry. Its U.S. operations include warehouses in Allentown, Pa., and Ontario, Calif., and a facility in Lehigh Valley, Pa.
While its cups, plates and cutlery product lines all posted growth in 2019, Fuling's plastic straw sales suffered, dropping 7 percent to $21.9 million.