China Cereals, Oils and Foodstuffs Import and Export Corp (Cofco), the dominant grain trader in the mainland, has offered to buy 59.63 per cent of A-share property developer Shenzhen Baoheng Group for 783.78 million yuan in a move to consolidate its logistics and foodstuffs business in Shenzhen. The state-owned firm, which appointed former chief executive of red-chip company China Resources Enterprise Frank Ning Gaoning as chairman last week, bought 278.06 million shares at 2.81 yuan each, a 24.6 per cent premium to Baoheng's net asset value of 2.255 yuan per share. The deal will see Baoheng become Cofco's Shenzhen-based flagship as it takes charge of its logistics, storage, trading and merchandising of foodstuffs. Baoheng will also control property development and investment. According to Baoheng's statement to the Shenzhen stock exchange, Cofco plans to inject its Shenzhen-based assets into the A-share company. These totalled 582.35 million yuan at the end of 2003, with a turnover of 355.86 million yuan. Cofco has made clear its intention to maintain Baoheng's listing status as it will seek an exemption from launching a mandatory general offer for the shares it does not own in Baoheng from the securities regulator. Cofco, which has its window company Cofco International listed in Hong Kong, has been reshuffling its portfolio in a bid to boost its asset base. Analysts speculated that a corporate restructuring at Cofco was on the cards following Mr Ning's appointment. Mr Ning replaced former chairman Zhou Mingchen, 63, who retired. In August last year, Cofco took over all the assets of China National Native Produce and Animal By-Products Import and Export Corp, one of the country's oldest trading firms.