AEM unit acquires 26.6% of South Korean firm for US$3.8m

MAINBOARD-LISTED AEM Holdings has acquired 26.59 per cent of the outstanding share capital of South Korean company Ateco Inc for approximately US$3.8 million.

As part of the investment done through AEM's wholly-owned subsidiary AEM Singapore, the group, which provides electronic and semiconductor solutions, has been given rights to acquire further shares of Ateco.

Together with the acquired shares, this will constitute up to 65 per cent of Ateco's total outstanding share capital on a fully-diluted basis.

These include the rights to subscribe for 369,231 convertible preferred shares for an aggregate subscription price of about 2.6 billion won (S$3.1 million) as well as an option to purchase from the existing shareholders of Ateco 1,039,489 shares for an aggregate purchase price of US$11 million.

The consideration, subscription price and option purchase were arrived at after negotiations on a willing-buyer and willing-seller basis, taking into account strategic merits of the partnership and prevailing market conditions, among other factors. The consideration was satisfied in cash using AEM's internal resources, the company said in a bourse filing on Thursday.

It also said the transaction is not expected to have any material impact on the group's net tangible assets per share and earnings per share for the financial year ending Dec 31, 2021.

Founded in 2012, Ateco designs and develops memory test handler solutions. As at end-September 2020, its book value stood at approximately 2.24 billion won while its net tangible asset value stood at about 2.76 billion won.

AEM's chief executive officer Chandran Nair said the investment allows both entities to work on joint development efforts to "stay ahead of the curve in test and handling for semiconductor devices". It also gives AEM access to the South Korean market.

AEM shares closed flat at S$3.98 on Thursday.