LI & Fung Ltd, a supplier of clothes, toys and home furniture to Wal-Mart Stores Inc, agreed to sell a HK$3.88-billion (US$497 million) stake to a unit of Temasek Holdings Pte to help fund acquisitions.

Dunearn Investments (Mauritius) Pte, owned by the Singapore government investment firm, will subscribe to 168 million new Li & Fung shares at HK$23.09 each, according to a statement filed to the Hong Kong stock exchange yesterday. That represents 4.6 percent of the enlarged share capital of the company, the statement said. Proceeds from the transaction will be used as "general working capital which may include funding acquisitions by the group from time to time," Li & Fung said.