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Ge-Shen Corp Bhd has entered a non-binding term sheet to acquire 60% stakes each in Amity Research & Development Sdn Bhd (ARD) and Amity Technical Services & Consultancy (M) Sdn Bhd (ATSCM) for RM13.5mil cash.

ARD is an engineering and consultancy services provider in the E&E industry while ATSCM is a manufacturer specialises in printed circuit board assembly (PCBA),

“The said acquisitions will incur a cost of RM13.5mil for the company, which will be entirely funded through internally generated funds and bank borrowings,” Ge-Shen said in a statement.

Upon completion of the proposed acquisitions, Ge-Shen said the target companies become 60.0% owned subsidiaries of the company.

The proposed acquisition involved purchasing 60,000 shares of ARD and 300,000 shares of ATSCM from the existing shareholders, Pak Yue Leong, Tan Chung Ken, Tan Guan Lai, Tan Khay Leang, Tan Kooi Loon, and Teh Sheh Chien.

Upon signing the term sheet, the company is expected to execute the share sales agreement within 60 days, with full payment to be completed within three months following the execution of the agreement.

Ge-Shen said the purchase justification is based on a price-to-earnings ratio of 4.5 times derived from a minimum net profit of RM3.0mil per year for the targeted companies, totalling RM6mil for the guaranteed period of the financial year ending Dec 31, 2024, and 2025.

“This proposed acquisition will expand Ge-Shen’s scale of operations and facilitate the group’s presence in such a market. It is also in line with the group’s objective of acquiring strategic stakes in companies involved in high value-added industries with potential for future growth,” it said.

Ge-Shen closed up 78 sen, or 24.3% to RM 3.99, giving it a market capitalisation of RM490mil. Year-to-date, the counter has risen by 244%.

About Amity

1.Professional PCB Manufacturer

Amity has been focusing on PCB design, prototype, manufacturing and assembly services for over 20 years.

2.One-Stop Electronics Manufacturing Services

PCB layout, PCB Fabrication, PCB Assembly, Box Build Assembly,IC Programming, Components sourcing, PCBA testing, No MOQ.

About Ge-Shen Group

Incorporated in 2003, Ge-Shen Group is focused in the South-East Asian region specialising in design, development and technology-driven manufacturing.   They are building ourselves to be leader in the precision components segment, providing superior capabilities in innovative mould design, fabrication, stamping, injection moulding, surface finishing and sub-assembly.Ge-Shen Group Serve many business sectors including automotive, medical devices & consumables, industrial applications, consumer electronics, office automation, home appliances and aerospace. They aim to partner with customers, providing a one-stop manufacturing solution and accelerating product speed to market.

Headquartered in Kuala Lumpur, the capital of Malaysia. Ge-Shen Group has a combined workforce of over 1,500 staff across 4 factories located in Malaysia and Vietnam and 1 global sales location in Singapore.

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