Latest Forum Topics /
HG Metal
Last:0.265
-0.005
|
 Post Reply
|
|
HG Metal's unit to buy 70% of BRC Asia for $48 mln
|
||||||||
|
chongpin
Member |
15-Aug-2008 19:59
|
|||||||
|
x 0
x 0 Alert Admin |
Clarification on article in Business Times BRC ASIA LIMITED Incorporated in the Republic of Singapore Company Registration No. 193800054G ANNOUNCEMENT The Board of Directors of the Company refers to the announcement released by the Company on 29 July 2008 regarding the originating summons with the High Court of Singapore (the " In the Article, Mr Lim Siak Meng, the Group Managing Director , was quoted as saying that Court") in relation to the supply of steel products to Sembawang Engineers & Constructors Pte Ltd ("SEC") and to the article titled "BRC will not be affected by lawsuit against SEC" published by the Business Times on 14 August 2008 (the "Article"). "SEC is not a major client and that the legal suit over payment for supplying steel products to SEC will not affect its business pipeline" and further that "this is our only major project with SEC so far".The Company would like to clarify that the Integrated Resort on Sentosa Island for Resorts World At Sentosa Pte Ltd Project (the " By order of the Board Wong Soong Kit Director/Secretary
|
|||||||
| Useful To Me Not Useful To Me | ||||||||
|
chongpin
Member |
14-Aug-2008 19:07
|
|||||||
|
x 0
x 0 Alert Admin |
Business Times - 14 Aug 2008
BRC will not be affected by lawsuit against SEC BRC Asia said that Sembawang Engineers and Constructors Pte Ltd (SEC) is not a major client and that the legal suit over payment for supplying steel products to SEC will not affect its business pipeline. 'This is our only major project with SEC so far,' BRC group managing director Lim Siak Meng said in response to queries at a briefing yesterday. In the past, BRC has been supplying to SEC on an ad hoc basis. Last month, BRC filed a complaint with the High Court, seeking a ruling that all and any steel products it supplied to SEC be paid on a quantum meruit basis and that it is not obliged to continue to supply the products to SEC since there is no binding contract. These steel products were supplied to SEC for the substructure work package it was awarded by Resorts World at Sentosa. BRC said that it had submitted a quotation to SEC for the supply of various reinforcing steel products which was valid up to May 25, 2007. Though SEC did not accept the quotation, it sent a letter to BRC expressing its intention to appoint BRC as its sub-contractor, subject to a formal sub-contract being signed. BRC was not agreeable to the terms set out in SEC's letter. While the final terms of a formal contract were being finalised, BRC had supplied about $39 million of products to SEC as at June 30 this year, based on the letter of intent. It has continued to supply to SEC, pending the court's ruling. Alternatively, BRC is seeking a ruling that the only valid contract is based on the terms of the quotation. Mr Lim declined to elaborate further on the legal dispute with SEC. But having made provisions for the contracts in its first half ended June 30, Mr Lim said that he now hopes that the second half will be better than the first half. A provision of $3.9 million for 'onerous contracts' in its first half ended June 30 dented the group margins, with net profit growing by a smaller 28 per cent year-on-year to $2.89 million although its revenue surged a robust 140 per cent to $120.4 million. Out of the total of $3.9 million provided for, $2.4 million relates to the supply to the Resorts World at Sentosa. Excluding the provision, BRC's net profit would have more than doubled from a year ago. BRC Asia is the takeover target of HG Metal, which proposed to buy a 70.28 per cent stake from Acertec Engineering for $48.13 million. HG Metal CEO Wee Piew said that this one-off event of supplying products without a formal contract 'won't happen again'. He noted that BRC has taken a conservative stand to fully provide for the amount in its first-half results. 'Going forward, as part of the control mechanism, BRC will not supply anymore products out of goodwill,' Mr Wee said. 'Everything will have to be contractually bound.' |
|||||||
| Useful To Me Not Useful To Me | ||||||||
|
|
||||||||
|
chongpin
Member |
14-Aug-2008 19:04
|
|||||||
|
x 0
x 0 Alert Admin |
Business Times - 14 Aug 2008
HG Metal unit to buy 70.28% of BRC for $48.13m HG Metal will undertake the acquisition in two tranches By LYNETTE KHOO HG Metal Manufacturing says it is going for the volumes game in the steel industry where size matters. Its 51 per cent-owned unit, HG Metal Pte Ltd, has agreed to buy 70.28 per cent of BRC Asia for $48.13 million or 11 cents per share from Acertec Engineering Ltd.
The offer price is at an 83.33 per cent premium over BRC's audited net tangible assets per share of six cents for the year ended Dec 31, 2007 and up to a discount of 10.6 per cent over the volume-weighted average price of its shares over the last six months. To manage its cash flow, HG Metal will undertake the acquisition - funded by internal cash hoard and debt financing - in two tranches. The first tranche will involve the purchase of 349.5 million BRC shares or 56.14 per cent stake, and this will take place by September after HG Metal has obtained shareholders' approval at an extraordinary general meeting. HG Metal is required to make a mandatory takeover offer for all the shares of BRC Asia that it does not already own under regulatory rules once the first tranche is completed. Under the second tranche, which will take place within a year from the completion of the first tranche, HG Metal will buy the remaining 88.05 million BRC shares or 14.14 per cent stake. This marks the HG Metal Group's first major acquisition after years of organic growth and the group will 'look at some more to come' both upstream and downstream, its CEO Wee Piew said at a briefing yesterday. HG Metal intends to maintain the listing status of BRC Asia after the completion of the deal. BRC, which derives its revenue locally, is mainly engaged in making and selling wire mesh under its 'BRC' brand name and developing a wide range of fabricated and prefabricated steel products for the construction industry. It has been the main supplier to public housing projects and has a dominant 40 per cent market share in the supply of wire mesh. Mr Wee noted that there are much synergies from the acquisition through cost savings from bulk purchase of materials, opportunities for cross-selling and streamlining of manufacturing and warehousing operations. There could be collaboration with BRC in the new warehouse that HG Metal is building in Nusajaya, Johor, he added. If this materialises, it will be BRC's first foray in Malaysia. BRC achieved a 28 per cent year-on-year jump in net profit to $2.89 million for the first half ended June 30 on the back of a 140 per cent surge in sales to $120.4 million. HG Metal will consolidate BRC's earnings by September next year. The HG Metal Group recently announced a near quadrupling in net profit to $28.5 million for the third quarter ended June 30 from $7.6 million for the previous year's third quarter as sales jumped 90 per cent year on year to almost $234 million. Mr Wee said there will not be major management changes at BRC following the acquisition and Lim Siak Meng, group managing director of BRC, will stay on. Mr Lim told BT that there is likely to be a rationalisation of business following the acquisition, with all development of steel reinforcing products likely to come under BRC. He said he believes the takeover by HG Metal will help expedite BRC's earnings growth. HG Metal Pte Ltd is 20 per cent owned by Lingco Marine Pte Ltd, which is 30.17 per cent held by the HG Metal Group's non-executive director Sia Ling Sing. Mr Sia also owns a direct 3.78 per cent stake in the HG Metal Group. Shares of BRC and HG Metal were halted from Tuesday pending the announcement and will resume trading today. |
|||||||
| Useful To Me Not Useful To Me | ||||||||
|
chongpin
Member |
13-Aug-2008 19:17
|
|||||||
|
x 0
x 1 Alert Admin |
Business Times - 13 Aug 2008
HG Metal's unit to buy 70% of BRC Asia for $48 mln By LYNETTE KHOO HG Metal Manufacturing said today that its 51 per cent owned unit HG Metal Pte Ltd has agreed to buy 70.28 per cent of BRC Asia for $48.13 million or 11 cents per share from Acertec Engineering Ltd to expedite its growth. This marks its first major acquisition after years of organic growth. The move will allow the group to expand its manufacturing capabilities, market share and streamline its manufacturing and warehousing operations, HG Metal said. It added that it intends to maintain the listing status of BRC Asia after the completion of the deal to allow the latter to continue to tap public funds. |
|||||||
| Useful To Me Not Useful To Me | ||||||||
