Union Steel has announced the signing of a non-binding term sheet to acquire the entirety of BTH Holdings for $17 million.
BTH Holdings is a company that is in various businesses catering to the offshore oil and petroleum industries. These businesses include the installation of industrial machinery and equipment, manufacture of pressure vessels, heat exchangers and plant and metal fabrication.
Union Steel believes that this acquisition “represents an attractive investment opportunity which will diversify its revenue streams.”
It added that this is in line with its expansion plans into complementary business areas within the marine, offshore and oil & gas industries through strengthening its engineering and manufacturing capabilities.
Union Steel also believes that this will strengthen its competitive advantage, value proposition and provide a holistic engineering solution to existing customers.
This will lead to it eventually gaining access to new markets, customers and business opportunities.
Under the term sheet, the consideration for the acquisition of all the shares will be $17 million, subject to adjustments to be agreed upon between the two sides.
As of now, 10% of the $17 million has been paid by Union Steel as a deposit. If the acquisition does not occur, the deposit shall be refunded to the company “as soon as reasonably practicable”, or within seven days.
If the acquisition is undertaken, it will be subject to shareholders’ approval at an EGM, as well as Union Steel’s due diligence.
Shares of Union Steel closed at 70 cents on Aug 31, down 1.41% or one cent lower than its previous close.
