A number of acquisitions and disposals took place recently, on the SGX, as companies seek to streamline their businesses and shed loss-making units.
Mencast to buy Stone Marine Singapore for $2.5m
The offshore and engineering, marine and energy services provider will pay around S$2.5 million (butterfly clip) less the aggregate amount of all of Stone Marine’s outstanding debt.
Stone Marine makes and repairs marine propellers, associated stern gear and seals.
Under the deal, Mencast will be granted an exclusive territorial licence to make propellers, associated stern gears and HydroSeals under the “Stone Marine” and “Stone Marine Seals” brands for the Asia Pacific, excluding China and Korea. It will also be granted a shared territorial licence for the Middle East, China, India, the Netherlands, Pakistan, Russia, Korea and Africa (excluding South Africa).
Mencast will pay a royalty fee and purchase propeller designs from Langham, the parent company of Stone Marine.
Xpress disposes foreign subsidiaries, assets to China Gateway for $730,000
Printing company Xpress Holdings has entered a sale and purchase agreement to dispose its foreign subsidiaries and assets to China Gateway (Greater China) Consultants for S$1 million ($730,000).
The subsidiaries up for sale include Precise Media Group, Xpress Print (Shenzhen) Co., Xpress Print (K.L.) Sdn Bhd, Xpress Print (H.K.) and Shenzhen Jiaxingda Printing Co.
Xpress noted that the proposed disposal of the loss-making subsidiaries will enable the group to streamline its structure, reduce its fixed operating costs and minimise the future losses to the group.
The disposal will also free up its resources and capital for allocation to its other profitable operations.
Xpress is expected to record a loss on disposal of about S$20.9 million. This includes the realisation of the accumulated foreign exchange losses of S$10.6 million.
In FY2015, Xpress incurred a net loss of S$500,000 and an operating loss of S$605,000 (excluding one-off items) attributable to the subsidiaries.
The group said this was the result of competition from digital media providers and China’s economic slowdown.
“As restructuring the subsidiaries requires further investment in capital outlay and highly-skilled human resources which carries high business risks with an uncertain investment horizon and the sale of the subsidiaries enables the group to realise more value than voluntarily liquidating the subsidiaries,” it said.
China Gateway was incorporated in the British Virgin Islands, and is an investment holding company which has a diversified investment portfolio in media related companies and assets in Asia.
Fuxing to sell entire stake in loss-making Qingdao Hong Shi
Fuxing China’s wholly-owned subsidiary Jade Star Group Holdings entered a share transfer agreement with purchaser Cai Chang Cheng. Jade Star will make a gain of RMB 8.6 million, which will be channelled into working capital requirements, the company said in a filing.
The proposed disposal will enable the group to dispose of its finished zippers manufacturing business and streamline its structure and business operations.
Qingdao Hong Shi has been loss-making since 2008.
The disposal will also allow the group to reallocate its resources to focus on its existing core businesses and any future business opportunity which will enhancing shareholders’ value.
China Yongsheng appoints Fraser Securities as IFA
Concrete supplier China Yongsheng has appointed KGI Fraser Securities as the independent financial adviser (IFA) for its privatisation deal, at S$0.032 per share.
In an SGX filing, the company said a circular containing the IFA advice and the recommendation of the independent directors on the offer will be sent within 14 days from the date of despatch of the offer document.