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DeClout disposes e-commerce platform solutions provider for S$21.9m in share transfer deal
DECLOUT on Monday said that it has signed a sale and purchase agreement to sell to Choo See Wee its full stake in e-commerce platform solutions provider Corous360, in return for a 12.5 per cent shareholding in Grand Centrex, an investment holding company owned by Mr Choo.
Mr Choo is also a director of Play-E Corporation, an associated company of Corous360, as well as the subsidiaries of Play-E Corp.
Corous360 is part of DeClout's vertical domain clouds (VDC) business segment and currently operates two platforms, an online-mobile-offline platform targeting premium users who purchase games and collectibles, and ZiPAY, an e-money platform targeting the unbanked mass market users.
Under the agreement, Grand Centrex is to acquire Titan Digital Media and Qisahn before completing the purchase of Corous360, and to acquire Epicsoft Asia within 30 days after completing the purchase of Corous360. Epicsoft Asia is an associated company of Corous360 and a wholly owned subsidiary of PlayE Corp.
The intended business activities of Grand Centrex will comprise the distribution of gaming products and peripherals (under Epicsoft Asia); retail stores for toys, games and hobbies (under Qisahn); and social media digital marketing and content creation (under Titan).
The consideration for the disposal is S$21.9 million, which will be satisfied by the transfer of 625 new shares in Grand Centrex from Mr Choo to DeClout at S$35,044.80 per share.
Corous360’s book value as at end-September 2018 was S$19.6 million. The deal consideration took into account, among other things, Grand Centrex's financial projection and business plan to grow the business aggressively with a view to unlock shareholder value in the short- to mid-term through a harvest.
No independent valuation was conducted on Corous360 or the consideration shares for the purpose of the deal.
Assuming that the disposal is completed by end-September 2018, DeClout would record an expected gain of S$70,000, after taking into account deal-related expenses.
DeClout's motivation for the disposal was to sharpen its focus on its IT Infrastructure and VDC segments, currently operated by its subsidiaries, Beaqon and vCargo Cloud, respectively.