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Manufacturing Integration Technology to sell semiconductor business for S$84.5m

MANUFACTURING Integration Technology is looking to dispose its semiconductor business for an estimated price of S$84.5 million and focus its energies on contract equipment manufacturing and customised automation as its core business.

It announced on Wednesday in a Singapore Exchange filing that it had entered into a share purchase agreement with Ningbo MIT Semiconductor Company for its entire shareholding interest in its wholly-owned unit, MIT Semiconductor.

The purchaser is a nominee vehicle designated by CFTC, a China-based private equity fund management company founded by Semiconductor Manufacturing International Corporation.

Various assets and two other wholly-owned subsidiaries, Generic Power and i.PAC Manufacturing, will be transferred to MIT Semiconductor as well as a condition for this proposed disposal. The three units design and manufacture automated equipment for the semiconductor industry.

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The company said that the proposed disposal will allow it to unlock value that had been accumulated for the benefit of shareholders, and it intends to distribute net proceeds by way of a special dividend or capital reduction.

The proposed disposal offers an important avenue for the semicon business to develop a second pillar in the PRC market, the announcement said.The company expects to make a first distribution of 24 Singapore cents per share based on the first payment received by the company upon completion as soon as practicable.

This sale will be satisfied in cash, and the disposal will require the approval of shareholders at an extraordinary general meeting to be convened. 

Kwong Kim Mone, chairman and managing director of the company, and his management team may also acquire or subscribe up to 10 per cent of the equity interest in the Ningbo MIT Semiconductor Company after the sale is completed. As such, Mr Kwong and his holding company MIT Technologies will abstain from voting.

Manufacturing Integration Technology's counter closed 0.5 Singapore cent higher at S$0.33 on Wednesday before the announcement was made.