Addvalue shareholders approve spinoff of unit, share dilution for Nasdaq listing

[SINGAPORE] Shareholders of satellite communications provider Addvalue Technologies have approved a proposed spinoff and Nasdaq listing of its wholly owned subsidiary Addvalue Solutions (AVS), as well as an associated proposed dilution of its shares.

AVS deals with the group’s activities involving the Inter-Satellite Data Relay System (IDRS). It serves to establish a connection between network operators and their space assets.

A new entity, incorporated as a holding company of AVS, will undertake an initial public offering of its shares. Addvalue in April said AVS and any other entities engaged in the IDRS business would be transferred or grouped under a newly incorporated investment holding company.

The proposed spinoff and listing will result in a dilution of Addvalue’s indirect equity interest in AVS, due to the issue of new holding company shares during the offering and an allotment of underwriter fee shares.

Addvalue anticipated a percentage reduction of no more than 30 per cent of its indirect equity interest in AVS. Because AVS is considered a principal subsidiary that accounted for 24 per cent of the group’s pre-tax profits for the 2026 financial year, Addvalue was required to seek shareholder approval.

Ahead of Thursday’s (Sep 24) extraordinary general meeting, shareholders had questioned the rationale for spinning off the IDRS unit. Addvalue had said the exercise would remove any potential “conglomerate discount”, so that analysts and investors can independently value the group’s distinct operations.

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However, shareholders had argued that as the parent group will continue to consolidate the US-listed subsidiary’s financials, evaluating the remaining business could become complicated due to differing accounting standards in the US and Singapore.

Investors also asked for clarity on the involvement of the project consultant team engaged for the transaction, questioning their role in identifying strategic partners and how those partners will support future growth.

Shares of Addvalue fell 2.6 per cent to close S$0.005 lower at S$0.185 on Thursday, before the news.