AEM to raise S$103.1m from proposed private placement to Temasek

AEM Holdings has proposed a private placement of 26.8 million ordinary shares to an indirect wholly-owned subsidiary of Temasek, at an issue price of S$3.8477 per share.

This represents 9.5 per cent of the total current number of issued shares in the electronic services provider, as well as a discount of 6.01 per cent to the weighted average price of trades of AEM shares done for the full market day on Thursday.

In its announcement on Friday after calling for a trading halt, the group said it was approached by Temasek's subsidiary, which had expressed an interest in a potential investment in AEM.

The group believes the proposed share subscription will bolster growth opportunities through "investing in next generation testing capabilities, deepening research and development to accelerate product portfolio expansion and funding its mergers and acquisitions plan".

It is expecting to net about S$103.1 million in proceeds from the new share issuance, which will go to financing the group's business expansion including organic expansion as well as mergers and acquisitions.

The transaction will bring AEM's total share capital to 308.8 million shares worth S$170.4 million from 282 million shares valued at S$67.3 million as at Aug 6, 2021.

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For illustrative purposes, net tangible asset per share as at end-2020 would have been S$267.6 million post the new share placement, as opposed to S$164.6 million.

Russell Tham, Temasek's joint head of enterprise development group, as well as joint head of strategic development, has been nominated to AEM's board of directors. The appointment is expected to take effect upon completion of the placement.

Prior to joining Temasek in May 2020, Mr Tham spent two years at mainboard-listed ST Engineering and 24 years at American corporation Applied Materials, where he held various regional and global leadership positions across a number of core business functions.

"At a time of significant change and opportunity in the semiconductor industry, the backing by a globally connected investor such as Temasek allows AEM to lean more purposefully into our growth plans," said AEM non-executive chairman Loke Wai San.

"The board of directors at AEM looks forward to working with Russell and tapping on his vast industry experience," he added.

Shares of AEM closed at S$4.17 on Friday, up 2.0 per cent.