PE firm Northstar completes Innovalues acquisition

Visual of Northstar Group homepage. October 2016

Private equity (PE) firm Northstar said it had completed its S$331.4 million ($238 million) acquisition of Singapore-listed precision machined parts maker Innovalues Ltd.

Northstar also said it was bullish on the precision manufacturing sector, and would explore opportunities to ‘actively grow Innovalues’ business both organically and inorganically’, implying that bolt-on acquisitions could be on the cards.

The private equity firm had recently bid for a similar company in Singapore.  But it failed to acquire local homegrown manufacturer of precision machined parts Spindex after a consortium controlled by the latter’s chairman acquired a majority stake in the firm.

The deal to acquire Innovalues was announced in October last year, and was executed via a scheme of arrangement.

Earlier this year, shareholders had approved the takeover of Innovalues by Northstar Advisors-backed Precision Solutions Limited at S$1.01 a share. (Precision Solutions Limited is an indirect wholly-owned subsidiary of Northstar Equity Partners IV Limited, an investment fund advised and managed by Northstar Advisors Pte Ltd.).

Innovalues subsequently got de-listed from the Singapore stock exchange last week after the acquisition.

Innovalues specialises in the manufacturing of customised precision machined parts and components, predominantly for the automotive and office automation industries. In addition, Innovalues also provides various surface treatment services for precision machined components. It sells to blue chip customers globally and has manufacturing operations in Thailand, Malaysia and China.

“Precision manufacturing is a sector that we like tremendously, and we will be seeking opportunities to actively grow Innovalues’ business both organically and inorganically,” said Northstar CEO Tan Choon Hong in a statement.

Northstar, the Singapore-headquartered PE firm, manages more than $2 billion in committed equity capital in growth companies in Southeast Asia, has investors that include sovereign wealth funds, pension funds,endowments, family offices, and other institutional investors.

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