PE firm Northstar proposes to buy Innovalues for S$331.4m via scheme of arrangement

PRIVATE equity firm Northstar Advisors has launched a S$331.4 million takeover offer for Innovalues Limited via a scheme of arrangement.

Offering to acquire Innovalues shares at S$1.01 each via special purpose vehicle Precision Solutions Limited (offeror), Northstar said on Wednesday that this provides an opportunity for shareholders to realise their investments in Innovalues at a premium of 19 per cent over its one-month volume weighted average prices (VWAP) before April 7.

On the other hand, the acquisition of Innovalues "represents an opportunity for the offeror to acquire control of a company in the precision manufacturing sector with a regional manufacturing footprint", Northstar said.

The offeror is an indirect wholly owned subsidiary of Northstar Equity Partners IV Limited, an investment fund advised and managed by Northstar, a Singapore-licensed fund management company managing more than US$2 billion in committed equity capital dedicated to South-east Asia.

Under the scheme, Innovalue shareholders can choose either a full cash payment of S$1.01 per share or a combination of cash and shares of Precision Solutions Group, which is the parent company of the offeror. The latter option comprises S$0.61 in cash and one share of Precision Solutions Group for every Innovalues share. No more than 19.8 per cent of all of Innovalues shares shall be elected for the cash-cum-share option.

Four major shareholders - including the CEO Goh Leng Tse, directors Pung Tong Seng and Ong Tiak Beng and substantial shareholder Koh Boon Hwee - collectively own 38.73 per cent stake in Innovalues and have undertaken to vote in favour of the scheme.

The scheme will require the court's sanction and approval by Innovalues shareholders representing not less than 75 per cent in value of the shares held by those voting at the scheme meeting.