Accrelist’s 53.07%-owned subsidiary Jubilee Industries Holdings has divested a 30% stake in Honfoong Plastic Industries Pte. Ltd. to Optium Gains International for a cash consideration of $1.5 million.
The move was made to “drive further growth and unlock value”, says Accrelist in an Oct 17 statement.
Honfoong Plastic Industries Pte. Ltd. is part of Accrelist’s mechanical business unit (MBU).
The consideration represents a premium of 42.9% over the total consideration for Jubilee’s initial acquisition of Honfoong in December 2017.
The sale of the stake in Honfoong was made through a sales and purchase agreement (SPA) entered into by Jubilee’s wholly-owned subsidiary, WE Total Engineering Sdn. Bhd. with Optium.
“To the fullest extent permissible under the laws, Jubilee intends to return the full amount of the sale proceeds to the shareholders in an effective and cost-efficient manner,” says Accrelist via its statement.
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Optium Gains is a Hong Kong-incorporated company that produces, processes, and assembles electronic accessories.
In addition, Jubilee, on Oct 13, announced that it had entered into a shareholders’ agreement (SHA) on Oct 11 with UPC Electronics Pte. Ltd. for the disposal of its 14% stake in WE Components.
The disposals of Honfoong and WE Components would “enable Jubilee to access new customers, deeper expertise and stronger financial resources through new synergies with Optium and UPC”, says Accrelist.
Jubilee’s MBU quadrupled its plastic injection moulding capacity following the acquisition of Honfoong in December 2017, increasing the range of products produced by Accrelist to serve various industries.
Jubilee’s MBU achieved a compounded annual growth rate of 39% in revenue between the FY2018 and FY2022 ended March 31. In addition, Jubilee’s EBU recorded a 67.4% increase in revenue from $119.9 million for FY2021 to $200.7 million for FY2022.
Shares in Accrelist closed 0.1 cent higher or 2.50% up at 4.1 cents on Oct 17, while shares in Jubilee closed 0.6 cent lower or 20% down at 2.4 cents on the same day.
