Memtech IFA says Chuang family's S$1.35/share cash offer 'fair and reasonable'

THE independent financial adviser (IFA) for Memtech International said that the cash offer of S$1.35 per share by a consortium led by company chairman Chuang Wen Fu to delist the firm is "fair and reasonable".

In a circular to the electronics components manufacturer's shareholders, IFA PwC Corporate Finance advised independent directors to recommend that shareholders accept the offer, which they are doing so.

This comes as the offer price is at a premium of 23.9 per cent to the closing price of S$1.09 per share as at the last trading day. It is also at a premium of 8.7 per cent to the net asset value per share of S$1.24 as at March 31, 2019.

The offeror is a special-purpose vehicle which mixes the interests of the Chuang family, which owns Memtech, as well as investment holding firm Keytech which is owned by the Chuang family and certain current and former members of Memtech's management team. Universal Global Technology (UGT) is also coming in as a strategic investor.

The offeror currently controls 57.77 per cent of Memtech. The plan is for Keytech to hold a 57.77 per cent equity interest in the offeror with UGT owning the remaining 42.23 per cent.

UGT is investing in Memtech in order to deepen its relationship with the company and diversify its design and supply chain capabilities, it said.

The offer will become unconditional if the offeror receives, by the close of the offer, valid acceptances for it to control no less than 90 per cent of Memtech. The offeror reserves the right to reduce the acceptance condition to 50 per cent, but the offer is final and the offeror does not intend to revise its offer price.

Shareholders who wish to accept the offer must do so by 5.30pm on June 28.