CGS-CIMB Research analysts William Tng and Izabella Tan see encouraging signs coming with Excelpoint’s acquisition by WT Microelectronics, as noted in a June 28 unrated research report.
Excelpoint announced on April 13 that WT Semiconductor Holdings, a wholly-owned subsidiary of WT Microelectronics, will acquire 100% of issued ordinary shares of Excelpoint through a scheme of arrangement.
The acquisition is expected to be completed in 3QFY2022 ending September, following which Excelpoint will be delisted from SGX, according to its offer document.
WT Electronics’ offer of $1.93 per share values Excelpoint at 6.8x FY2021 P/E and 1.5x FY2021 P/BV. At its offer price, the scheme consideration exceeds the highest closing price of Excelpoint’s shares in the 10-year period till April, according to Excelpoint’s offer document.
Tng and Tan observe that WT Electronics has a niche in providing supply chain management services to both vendors and customers. In the offer document, Excelpoint also expects that the enlarged group will be able to enhance offerings of product lines since both WT Electronics and Excelpoint’s products complement each other.
WT Electronics can cross-sell its products to Excelpoint’s customers as well.
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Excelpoint is a regional business-to-business (B2B) platform supplying electronic components and providing engineering design services and supply chain management to original equipment manufacturers (OEM) and original design manufacturers (ODM) as well as electronic manufacturing services in Asia Pacific.
The company was on the top 25 Global Electronics Distributors lists by EBN, an online community for global supply chain professionals, and News for Electronics Purchasing and the Supply Chain (EPSNews), a US-based data portal and resource centre for electronics and supply industries, according to Excelpoint’s FY2021 annual report. It also collaborates with its principals to create solutions to complement its customers and solutions,and has research and development (R&D) centres in Singapore, China, and Vietnam.
As at 10.57am, shares in Excelpoint are trading flat at $1.89.
