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Lereno Bio-Chem lines up a third RTO target as second attempt falls through
CASH company Lereno Bio-chem was unsuccessful in its second reverse takeover (RTO) attempt, with the announcement that its sales agreement with Kenyalang Property Development has fallen through.
Following the termination with Kenyalang, it has inked a new RTO pact with Knit Textile and Apparel.
In a separate release to SGX, Catalist-listed Lereno Bio-Chem said that it, together with Lim Siau Hing @ Lim Kim Hoe, has entered into a conditional put and call option agreement. Under the agreement, Lereno Bio-Chem is proposing to acquire Knit - which is owned by Mr Lim - for around S$26.4 million, which will be fulfilled via the issuance of new shares in Lereno at S$0.01 per share.
If this comes to fruition, this would be its third RTO attempt. Prior to this, it had announced that it was planning to buy Malaysian property developer Majubina Projects.
Under the agreement, Mr Lim will undertake a restructuring in which Knit will acquire the following companies: Knit Textiles Mfg Sdn Bhd, Ocean Art & Embellishment Sdn Bhd, Moon Apparel (Cambodia) Co, Callisto Apparel (Cambodia) Co and Xentika.
These companies - which are controlled by Mr Lim and his family - are primarily in the business of contract manufacturing of clothing in Malaysia and Cambodia, and are currently in the process of expanding upstream into the knitting, dyeing, printing and finishing of fabric.
Mr Lim will hold approximately 80.2 per cent of the enlarged issued share capital of Lereno Bio-Chem once the deal has been completed.