sgusers2的部落格

Shares gain 5% on purchase of Mech-Power GeneratorSHARES in XMH Holdings rose 2 cents, or 4.新蒲崗迷你倉9 per cent, to 43 cents yesterday after the diesel engine provider announced an acquisition over the weekend.In its first major acquisition since a Koh Boon Hwee-related private equity fund invested in the firm, XMH Holdings is planning to buy a power generator manufacturer for about $17.4 million.Mech-Power Generator (MPG) Group, whose generator sets are used in shipyards and ports, hospitals, data centres and airports, will complement XMH, whose strength lies in marine-sector applications, said XMH chairman and CEO Elvin Tan."There will be opportunities in terms of obtaining better engine prices, exchanging capabilities and therefore reducing our manpower costs," said Mr Tan. "There will also be opportunities to market to mutual customers."MPG Group, owned by Loke Choon Hoe and Madam Tham Sow Lin, started business 30 years ago. It supplies a wide range of generator sets ranging from power capacity of 20 kilovolt-ampere (KVA) to 2,500 KVA.These are made using engines from brands such as MTU, Mitsubishi, Man, Perkins and Volvo Penta.MPG Group owns a 1.4 hectare plant in Iskandar, Malaysia, which it says gives it a lower cost of production compared to its competitors. Half of its 120 staff amini storagee based there."Every major project - MRT, airport, hospital - needs power generating sets, which we are providing," said Mr Loke.The consideration of $17.4 million will be paid in two equal tranches of about $8.7 million each.Half of the consideration will come from internal resources, and half through the issuance of new XMH shares.The sales and purchase agreement also provides for a profit and net tangible asset warranty."The aggregate audited consolidated net profit after tax excluding extraordinary gains of the MPG Group for both FY2014 and FY2015 shall not be less than $6.9 million and the audited consolidated NTA of the MPG Group shall not be less than $4.5 million as at balance sheet date as shown in the FY2013 accounts of the MPG Group," said XMH.OSK-DMG analyst Lee Yue Jer yesterday upgraded the stock from "neutral" to "buy"."The deal is strong earnings per share-accretive, reduces business risk through diversification into adjacent sectors and immediately removes constraints on its growth," he said."Post deal, XMH remains in a net-cash position and is still on the lookout for more acquisitions."XMH had surged 30 per cent in May, when it was announced that private equity fund - Credence Capital Fund II (Cayman) - linked to businessman Koh Boon Hwee had invested in the firm.self storage