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Allied Tech gets LOI for S$130m RTO of dormitory operator

CATALIST-LISTED Allied Technologies on Monday said it has received a letter of intent (LOI) for the proposed acquisition of "one of the largest dormitory operators in Singapore" for S$130 million that could result in a reverse takeover (RTO).

The precision engineering company said the board was still reviewing the terms of the proposed deal as contained in the letter dated Apr 25 from Lim Yew Ming, the vendor, and information on the target company Aik Chuan Construction Pte Ltd, a construction, development and dormitory operator.

Mr Lim wholly owns Aik Chuan Construction which has been in operations since the early 1980s, said Allied Tech in Monday's announcement.

The proposed acquisition of the target company as indicated in the letter that is intended to be a basis for negotiations is to be satisfied by between S$30 million and S$50 million cash with the balance through the issue and allotment of new Allied Tech shares at an issue price not exceeding one Singapore cent per share.

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The LOI has not been executed by the company and does not constitute any legally binding obligations on the company and the vendor, it added.

Allied Tech's shares have been on a trading halt since Friday noon and were last traded at 1.1 Singapore cents.