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AEM Holdings' largest shareholder sells 6% stake to new institutional investors for S$24.4 million

AEM HOLDINGS' largest shareholder has sold off more of its stake to new shareholders, the mainboard-listed manufacturing services and equipment services group announced on Sunday.

The company said in a statement that the move is part of a plan to "broaden its shareholding structure" by attracting more long-only institutional and family funds.

Shareholder Orion Phoenix, which is controlled by private equity fund Novo Tellus Capital Partners, sold four million shares to such funds on March 2 at S$6.10 apiece - or S$24.4 million in all.

This was a discount of about 4.84 per cent on AEM shares' last traded price of S$6.41 a share on March 2, before the announcement.

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The off-market transaction cut Orion Phoenix's interest in AEM from roughly 23.3 per cent to 17.3 per cent.

Long-only funds bank on an appreciation in value when making investments, as opposed to a "long-short" fund investment strategy that also looks for investments that are headed downwards.

AEM executive chairman Loke Wai San said in a statement: "We welcome a stronger and wider institutional shareholding support for AEM as this can bring higher levels of scrutiny and demand for management accountability."