Sappe will buy 672,000 ordinary shares at US$3.11 each. Coconut Factory Co owns All Coco Company, which manufactures coconut-based beverages, and K Best Farm Company, which exports more than 20m coconuts annual to 20 countries.
The share purchasing is expected to be completed by October this year.
Sappe is a Thai functional beverage and powders manufacturer with a special focus on beauty-conscious consumers.
Last month in launched it new soy peptide formula under its Preaw Coffee brand.
The instant coffee also contains gingko and multivitamins that the firm claims help improve cognitive function. It’s six-formula flagship Sappe Beauti Drink has been on the market for 10 years.
Sappe's chief executive Piyajit Ruckariyapong said the Coconut Factory deal would help expand the company's fruit juice portfolio, which contributed 60% of its total revenue last year.
He also said it was to tap into the growing global demand for coconut water, although claims of its nutritional benefits remain contested.