AOM International's (HKG:0381) wholly owned subsidiary has agreed to acquire a 72.5% stake in Jiangxi Jiuai Food for HK$59 million, to be settled through the issuance of zero-coupon convertible bonds in the same principal amount, according to a Friday Hong Kong bourse filing.

Shares of the company rose nearly 11% in Monday morning trade.

The convertible bonds, carrying a conversion price of HK$0.25 per share, may be converted into up to 236 million new shares, representing about 24.9% of AOM's existing issued share capital and 20.0% of the enlarged capital after full conversion.

Upon completion, Jiangxi Jiuai will become an indirect non-wholly owned subsidiary, with its results consolidated into AOM's financial statements.

AOM said the deal, which remains subject to shareholder approval and regulatory clearance, will expand its business portfolio into the beverage sector and capture growth opportunities in China's healthy-lifestyle consumer market.