XMH HOLDINGS last year made a 100% acquisition of Mech-Power Generator, a move that has proven to be highly positive for its top- and bottom-line.
Following the release of the news, the stock price traded up 2 cents to 33.5 cents.
The acquisition of Z-Power will also bring onboard the Niigata brand of main engines and propulsion systems for which Z-Power is an OEM, as well as the technical service and maintenance support.
This will further expand XMH’s suite of products which are synergistic to its core business of being a diesel engine, propulsion and power generating solution provider in the marine and industrial sectors.
The purchase consideration of S$13.2 million (for an 80% stake) is similar in size to the S$17.45 million which XMH paid for a 100% stake in Mech-Power.
The Z-Power vendors will be paid in two tranches, with the first tranche of S$10.56 million to be paid shortly after the completion of the acquisition.
The second tranche of S$2.64 million is to be paid on the first year of the completion of the acquisition.
The four will hold the remaining 20% stake and stay on at Z-Power for 3+3 years.
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