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Procurri loses another potential buyer as New State withdraws offer

ENTERPRISE hardware supplier Procurri Corporation said a proposed investor New State Capital Partners has withdrawn its acquisition offer, it said on Tuesday.

No specific reasons were provided for the withdrawal of the letter of intent by New State - with the deal first announced on Feb 3. New State, a private investment firm which operates in the US and focuses on investments in business, healthcare and industrial services industries, had then proposed to acquire all the shares of the company, other than treasury shares and shares held by substantial shareholder Irrucorp, via a scheme of arrangement.

Irrucorp, in which Procurri chairman and global CEO Sean Murphy, and executive director and global president Edward Flachbarth are deemed to have interests, owns about 12.03 per cent of the company as at March 16, 2018, according to Procurri's 2017 annual report.

New State's latest withdrawal follows a termination of further discussions with another interested buyer, who was unnamed.

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The bowing out by New State also comes as Proccuri's major shareholder DeClout announced in February it would further pare its stake in mainboard-listed Procurri. It intends to sell 36.3 million of its Procurri shares to a fund held by a private equity firm - Novo Tellus PE Fund 2 - at S$0.33 per share to raise net proceeds of S$12 million.

Procurri on Tuesday said the deal between DeClout and the private equity firm would be done via a put and call option agreement. The options are due to be exercised between March 18 and April 17, 2019.

DeClout now owns less than 30 per cent of Procurri, having earlier cut its stake from 46.8 per cent by selling in January another 48 million shares in Procurri  - or 17.2 per cent of the Procurri - at S$0.32 per share to two independent third parties. Based on regulatory filings, a Soh Chooi Lai had bought S$11.8 million worth of Procurri shares via a married deal with DeClout on Jan 4, translating to a 13.5 per cent stake in Procurri. The second party remains unnamed. Only shareholders who hold more than 5 per cent of shares in a company must declare their holdings in a regulatory filing. 

Shares of Procurri last traded on Feb 15 at S$0.31.