Debt-laden Stratech agrees to private equity takeover

Singapore

THE Stratech Group has agreed to place out an eventual 58.4 per cent stake in itself to a private equity investor for US$20 million and to convert about S$8.75 million of loans into shares, the surveillance technology company announced on Wednesday after the market closed.

Under the deal, Stratech will place 406.06 million new shares at 6.6 Singapore cents apiece to Boulevard Capital Partners, whose fund focuses on infrastructure investments in Asia and South America.

One condition for the placement is the conversion of Stratech's outstanding borrowings from current controlling shareholders David Chew and Leong Sook Ching into new shares at the same per-share price as the placement. Stratech said that it owes S$5.5 million to the two shareholders, who are also company directors, with a further S$3.25 million committed. Assuming that the entire S$8.75 million is converted, the Boulevard placement will represent a 58.4 per cent stake in Stratech's enl…