TasFoods (ASX:TFL) has entered into a non-binding option agreement with shareholder MSC ATF AgFood Opportunities Fund, or AgFood, and associates to potentially sell its Pyengana Dairy cheese manufacturing business for AU$2 million plus inventory, according to a Monday filing with the Australian bourse.

The option, exercisable until mid-September, would see settlement by Oct. 31, the filing said.

The deal is non-exclusive until exercised, and AgFood may partner with other buyers, the filing added.

The company will continue managing Pyengana Dairy under a paid service agreement after the sale.

Shares of the company rose 20% in recent Monday trade.