@ Smartflex's factory in Ubi: The company's executive chairman, Tan Tong Guan, in a high-tech cleanroom which has 11 production lines. NextInsight file photoSMARTFLEX HOLDINGS yesterday evening announced it would place out new shares to three investors at a premium to the market price for a total sum of $1.4 million.
Two of the investors are related and hail from the car industry:
1. Tan Ah Chew is the MD of Lake View Credit, a company which is engaged in vehicle sales and financing business.
He will take up 8 m shares, the biggest chunk of the placement, paying $800,000.
Photo: http://sg.jobsdb.com/2. His son, Vincent Tan Boon Kiat, 32, is one of the three founders of SgCarMart, a local online car portal which was acquired in April this year by Singapore Press Holdings for "up to S$60 million cash". This figure of "up to $60 million", as announced initially by SPH, was pegged at 12X its 2012 annual revenue (ie S$5 m). Subsequently, the actual transacted value was not revealed. Neither was its relation to SgCarMart's net profit revealed.
Vincent will cough up $200,000 for 2 million Smartflex shares.
The third investor is Ang Ah Nui, the Deputy MD of ASL Marine Holdings Ltd., a company listed on the Main Board of the SGX-ST and is engaged in shipbuilding, ship repair and conversion, and ship chartering.
He will come up with $400,000 for 4 million shares.
The subscription price of 10 cents represents a premium of approximately 7.5% to the weighted average price of 9.3 cents for each share, based on trades done on the Singapore Exchange on 16 May 2013, the last market day on which shares were traded prior to the signing of the subscription agreement.
It is at a historical price-earnings multiple of 11X and a sharp discount to the NAV of 13.8 US cents (17.25 Singapore cents) a share.
It is at a historical price-earnings multiple of 11X and a sharp discount to the NAV of 13.8 US cents (17.25 Singapore cents) a share.
Smartflex said it decided to undertake the placement to strengthen its financial position and flexibility to capitalise on growth opportunities. The placement funds will be used for general working capital purposes to fund the growth and expansion of the Company’s business.
The Catalist-listed company -- which has a market cap of S$7.7 million and a trailing dividend yield of 3.2% -- reported a 1.0% dip in revenue to US$25.1 million for 2012. Net profit was down 55.8% to US$594,000.
For insights into the business of Smarflex, read: SMARTFLEX: Producing 1.5 million modules for smart cards a day