Q&M Aidite International (QMAI), the subsidiary of Q&M Dental, has entered into a share purchase agreement with Aidite (Qinhuangdao) Technology (Aidite Qinhuangdao) and its shareholders to sell its remaining 12.246% stake in Aidite Qinhuangdao.
As at Jan 15, Aidite Qinhuangdao’s shareholders comprise Tianjin Yuan Yi Enterprise Management and Consulting Center, Tianjin Wen Di Enterprise Management and Consulting Center, Tianjin Jie Ying Management and Consulting Center, Suzhou Junlian Xinkang Venture Capital Partnership, Health Advance Limited, Schroder Adveq Asia Hong Kong I Limited and ASP Hero SPV Limited.
The agreement, which was signed on Jan 15, follows Q&M’s announcement on Nov 12, 2020, that QMAI has agreed to dispose of 36% of the registered capital of Aidite to Suzhou Junlian Xinkang Venture Capital Partnership, Health Advance Limited, Schroder Adveq Asia Hong Kong I Limited and ASP Hero SPV Limited.
The consideration of the sale shares is RMB122.5 million ($25.1 million), which was arrived at, based on an agreed valuation of Aidite Qinhuangdao of RMB1 billion.
No independent valuation was conducted.
The agreement will be effective once all the parties have signed and executed the terms of the agreement, and once Aidite Qinhuangdao has obtained the approval of its board of directors and shareholders in general meeting for the repurchase of its shares.
Following the completion of the agreement, QMAI will no longer have shares in Aidite Qinhuangdao.
The proposed disposal constitutes a “discloseable transaction” under Chapter 10 of the listing manual of the SGX-ST.
SEE: Acquisitions positive for Q&M Dental Group, core business still resilient: KGI Securities
Aidite Qinhuangdao is a Chinese-incorporated company that is mainly in the business of manufacturing zirconium oxide blocks, which are used in dental Computer-Aided Design/Computer-Aided Manufacturing (CAD/CAM) machines in the fabrication of dental prosthesis. It also distributes dental equipment and supplies specifically to complement the manufacturing of zirconium oxide blocks.
Q&M acquired Aidite Qinhuangdao in February 2014.
QMAI was incorporated on March 12, 2014, to hold shares in the capital of Aidite Qinhuangdao.
As at Jan 15, QMAI has an issued and paid-up share capital of $4,635,019.99 comprising 1 ordinary share and 6,084,168 preference shares. Q&M owns 100% of the ordinary shares and 75.02% of the preference shares in QMAI.
Q&M Professionals Holding Pte. Ltd. (Prof Holdco) owns 20.0% of the preference shares of QMAI and the remaining 4.98% is owned by Cheah Kim Fee, Initial Capital Investment Pte. Ltd., All Win Investment Holdings Pte. Ltd. and Full Win Investment Holdings Pte. Ltd.
The net asset value and the net tangible asset value of the sale shares as recorded in Q&M’s unaudited consolidated financial statements for the 1HFY2020 ended June were $11.5 million and $11.5 million respectively.
Following the disposal, Q&M will receive net proceeds of some $17 million, after tax expenses, legal fees and other transaction costs.
Q&M says it intends to use the proceeds for general working capital requirements, fund future business expansion and investments, as well as declare a special dividend to its shareholders.
Shares in Q&M closed flat at 47.5 cents on Jan 15.
