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Keong Hong to buy 60% of timber specialist for S$4.5m
KEONG Hong Holdings Limited has agreed to acquire 60 per cent of Hansin Timber Specialist and Trading Pte Ltd for S$4.5 million.
The amount will be paid with S$3 million of cash and 2.57 million new shares at an issue price of 58.5 Singapore cents apiece.
The target company supplies and installs timber floorings and exterior timber decking, trellis and roofing for residential and commercial development projects in Singapore. Following the deal, it will become a subsidiary of Keong Hong.
"The board is of the view that the proposed acquisition is in the best interests of the company and its shareholders as the target is profitable and is able to provide consistent returns to the group," Keong Hong said in an announcement on Friday.
It also explained that this is part of its corporate strategy for long-term growth to provide shareholders with diversified returns.
Keong Hong, which started out as a contractor in 1983, branched into property development in 2012 through a joint venture with Frasers Centrepoint Limited to develop the Twin Waterfalls executive condominium (EC) in Punggol. Its subsequent EC developments include SkyPark Residences, The Amore and Parc Life.
No valuation was conducted on the target, Keong Hong said. The cash component of the payment will be funded by internal resources.