Issue 46

Malaysian packaging firm Scientex to take over smaller rival Daibochi for $53m

Malaysia-based packaging manufacturer and property developer Scientex Bhd has proposed to acquire a 42.41 per cent controlling stake in smaller rival Daibochi for RM222.5 million ($53 million) or RM1.60 per share, it said in a filing with Bursa Malaysia today. 

Scientex and certain shareholders of Daibochi have signed a heads of agreement (HoA) for the acquisition via a proposed share exchange. 

“The proposed acquisition will be satisfied entirely via a share exchange of one new share for every 5.5 Daibochi shares held by the vendors,” said the stock filing. It added that upon the conditional share sale agreement becoming unconditional, Scientex will extend a mandatory takeover offer to acquire the remaining shares and warrants in Daibochi it does not already own. 

“This synergistic merger will create a formidable regional giant from Malaysia with extensive resources to compete globally, offering an integrated range of flexible packaging solutions to a larger client base. 

Further to extending our market reach, it brings together strong technical know-how and skilled talent to tap into the exciting growth prospects for this market segment,” Scientex managing director Lim Peng Jin said in a separate statement. 

Bursa-listed Daibochi is a flexible packaging provider with manufacturing facilities in Malaysia and Myanmar. Its clientele comprises mainly multinational corporations in the food and beverage, fast-moving consumer goods, and specialty sectors. 

The proposed share sale acquisition will be completed in six months from the date of execution of the conditional share sale agreement. The proposed mandatory takeover offer is expected to be completed in two months from the date the share sale agreement becomes unconditional. 

Established in 1968 as a PVC cloth and leather manufacturer, Scientex is now an industrial packaging manufacturer and a property developer in Southern Malaysia as well as the largest stretch film producer in Asia. It has manufacturing facilities in Malaysia, Vietnam and the US where about 75 per cent of its products are exported to over 60 countries.

  From – Deal Street Asia

Britain’s Brexit Solution Is Staring It in the Face

The best outcome is not leaving the EU at all.

Watching the Brexit debacle is like watching a horror movie where one obvious smart move — don’t go into the basement! — would save everybody a lot of trouble/death, but the characters keep doing the wrong thing. 

The Brexit horror show was action-packed today, with Prime Minister Theresa May barely clinging to her job after cabinet members quit in protest of her tentative Brexit pact with the EU. Now she faces long odds in getting Parliament to approve that deal. She argues it’s the only alternative to a no-deal Brexit, which would be economically apocalyptic. But there is actually a third, far better alternative — neither fleeing to the spooky attic of no-deal Brexit nor the dangerous basement of bad-deal Brexit, but to the blissful freedom of not Brexiting at all, Bloomberg’s editors write. May, or her lucky successor at 10 Downing, should admit the Brexit dream must die and allow a second referendum; Europe should give the U.K. extra time to work it out, the editors write. 

And make no mistake: May’s Brexit deal is bad, at least for Britain. It's great for the EU, writes Leonid Bershidsky, but that only makes it far less likely to pass parliamentary muster. And that makes a disastrous no-deal Brexit more likely, which would hurt the EU, too. It might want to bend a little more, Leonid suggests. 

Ousting May would make some Brexiters feel better. But it won’t solve the U.K.’s main problem, Therese Raphael writes, which is that Brexit itself is a dilemma with no good solutions. Even the referendum do-over is fraught with obstacles and potential risks, Therese notes. But as it is, Britain is being hacked slowly to pieces.

From - Bloomberg

The FinLab launches accelerator for SMEs in Thailand

The FinLab announced the launch of its Smart Business Transformation Programme to help Thailand-based small- and medium-sized enterprises (SMEs) transform their businesses through digital solutions.

The programme is supported by United Overseas Bank (Thailand) (UOB (Thai)) and the Digital Economy Promotion Agency (depa) of Thailand.

Thailand is the first market outside of Singapore where The FinLab will offer its SME business transformation programme. The Thai launch follows the success of the Singapore programme in August 2018 where 11 Singapore-based SMEs deepened their digital capabilities by piloting the use of technologies such as artificial intelligence and robotics process automation.

According to the findings of an online survey by The FinLab, Thai SMEs said their top two business growth strategies were to enter new markets (54 per cent) and to use online marketing (51 per cent). Social media marketing (62 per cent) and digital marketing (61 per cent) were their preferred methods to increase sales and to improve customer engagement.

However, while Thai SMEs were keen to tap digital solutions to enhance their online presence, they were concerned about the cost (67 per cent) and complexity (44 per cent) of implementation.

To help Thai SMEs drive their business performance, The FinLab’s three-month Smart Business Transformation Programme will help participating SMEs refine their business models and adopt digital solutions particularly those in online sales and marketing.
Mentors from The FinLab, UOB (Thai) and depa will also guide participating SMEs to identify the unique issues they face in their business and equip them with the tools and knowledge needed to innovate. The SMEs will then be matched with a suitable technology solution provider to address their concerns and to pilot the implementation of the solution.

Mr Felix Tan, Managing Director, The FinLab, said, “At The FinLab, our mission is to help SMEs across ASEAN validate their solutions and scale their businesses through digitalisation and business transformation. We are excited to bring to Thailand our experience on bridging ecosystems, helping SMEs to connect and to collaborate with leading technology providers to achieve commercial success. Through our new programme and with the support from UOB (Thai) and depa, we aim to push innovation boundaries and to forge new partnerships.”

Mr James Rama Phataminviphas, Head of Channels and Digitalisation, UOB (Thai), said, “At UOB (Thai), our experience and local presence give us first-hand understanding of what it takes to build sustainable businesses. Many Thai SMEs already have the desire to digitalise and we want to help them harness technology to overcome their business challenges and to grow their business. The FinLab’s Smart Business Transformation Programme will help participating SMEs gain the knowledge needed to transform their business and will also connect them to our wider ecosystem of technology providers in the region. Through our regional network, we will also be able to help these SMEs expand their businesses into other countries.”

Mr Chatchai Khunpitiluck, Senior Executive Vice President, Digital Economy Unit of depa, said, “With Thailand 4.0, we are moving into the next stage of economic growth and will see widespread use of digital applications for business. We welcome strategic ecosystem partners such as The FinLab and UOB (Thai) to support us in achieving our national digital economic objectives.”

The FinLab is now accepting applications from SMEs in Thailand for the Smart Business Transformation Programme until January 2019. It is also calling for global technology companies and start-ups to participate in the programme as solution providers. The Smart Business Transformation Programme will commence in April 2019.

From – Finextrant

Singapore’s Keppel confirms Ixom acquisition from Blackstone for $565m

Singapore-listed Keppel Infrastructure Trust (KIT) on Thursday announced that it will acquire Australian chemical firm Ixom HoldCo Pty Ltd for A$777 million ($565 million). 

The sellers are funds managed by Blackstone Group and management shareholders. The deal puts Ixom’s enterprise value at A$1.1 billion ($799.5 million). 

The acquisition is expected to be completed in Q1 of 2019, subject to necessary approvals, including from the Australian Foreign Investment Review Board and the New Zealand Overseas Investment Office. 

Ixom manufactures and distributes water treatment products and other chemical products. Upon completion of the transaction, KIT’s enlarged portfolio will grow from S$3.8 billion to S$5.1 billion, it said in its SGX disclosure. 

“The Ixom Group’s business model is aligned with KIT’s investment strategy to acquire industrial infrastructure assets that generate long-term stable cash flows with potential growth. 

The Ixom Group’s value proposition extends KIT’s capabilities into the water treatment chemicals sector in Australia and New Zealand,” KIT said in a separate statement. 

The acquisition will initially be funded through a bridge facility of up to S$750 million ($544.8 million) and a five-year term loan of A$532 million ($386 million), which will also be used to pay off an existing Ixom loan of A$432 million ($313.5 million). 

KIT said it intends to repay the debt from proceeds raised through an equity fundraising. The fundraising, the timing of which will be decided at a later date, could be a preferential offering, a rights issue, a private placement or a combination of two or more of these. 

Blackstone bought Orica’s chemical business for A$750 million ($536 million) in 2015 and renamed it as Ixom. The Aussie firm’s water treatment and chemical distribution business is largely focused on the Australia and New Zealand markets.

From –Deal Street Asia

WeWork opens first hub in the Philippines

WeWork, which recently raised $3 billion in fresh funding from SoftBank, has opened its first hub in the Philippines while Malaysia’s Securemetric announced raising $4 million in its IPO.

WeWork opens first hub in the Philippines 
New York City’s co-working space chain WeWork is opening its first hub in the Philippines in December, marking its foray into a market where startups and small entrepreneurs have limited co-working space options. 

The WeWork hub occupies two floors of Uptown Bonifacio Tower in Fort Bonifacio, Taguig City. The hub can accommodate 800 members, according to WeWork officials. 
The amenities include community bars, phone booths, WiFi, and breakout areas that have Filipino-inspired designs. 

The Philippine hub brings WeWork’s total market in Southeast Asia to four. It currently operates in Singapore, Indonesia, and Vietnam. 

WeWork’s regional managing director Turochas Fuad said the plan is to launch in six markets by the end of the year. 

Early this week, SoftBank agreed to pay $3 billion to WeWork for the opportunity to buy shares before September 2019 at a price of $110 a share or higher, depending on whether WeWork goes public, is acquired or raises a $1 billion round before that date.

From – Deal Street Asia
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