News

Introduction

Further to the announcement of even date on the incorporation of APM-TS B.V., the Board of Directors of APM Automotive Holdings Berhad (“APM” or the “Company”) wishes to inform the following agreements have been entered into on 13 November 2015 :

(a)    Agreement of Sale of Certain Assets of Business (“SPA”) between TS-Automotive B.V. (“TS” or “Vendor”) and Bent Holding B.V. (“BH”) and Mark Bent (collectively “Covenantors”) and APM-TS B.V. (“ATS” or “Purchaser”) and APM Auto Components Europe B.V. (“AACE”)

ATS or Purchaser which has been incorporated to carry out the business of development of springs, absorbers and coil-overs for the automotive market will acquire certain assets and business of TS or Vendor together with the transfer of approved certifications by TUV Automotive GmbH (the “TUV Certifications”) held by BH free from encumbrances at the settlement date which is 5 business days after the date on which all of the conditions precedent have been satisfied or the later of 1 December or waived for a purchase price of €450,869 (“Proposed Acquisition”).

TS, a wholly-owned subsidiary of BH, specializes in the business of development of springs, absorbers and coilovers (“Products”) with TUV Certifications for sale in the automotive replacement market. BH is a holding company, whose shares are wholly-owned by Mark Bent, and whose business is to hold shares in TS and the TUV Certifications.

The purchase price of €450,869 is subject to adjustment in accordance with the valuation principles and after verification of the value of the assets to be acquired as provided in the SPA for the assets. The purchase price will be paid entirely in cash from the cash proceeds from subscription for shares in ATS by AACE and BH. AACE will subscribe for shares in ATS from internally generated funds of the APM Group.

The highest percentage ratio applicable to the Proposed Acquisition pursuant to Paragraph 10.02(g) of the Bursa Malaysia Securities Berhad Main Market Listing Requirements is 0.19% based on the audited financial statements of the APM Group for the financial year ended 31 December 2014.

(b)    Subscription and Shareholders’ Agreement (“SSA”) between APM Auto Components Europe B.V. and Bent Holding B.V. and Mark Bent (“MB”) and APM-TS B.V.

AACE and BH propose to jointly develop and grow the business of ATS by capitalizing on each other’s capabilities and those of MB.

The SSA provides for the subscription for shares in ATS by AACE and BH and the regulation of the relationship of the parties with each other in relation to ATS and certain of the affairs of and their dealings with ATS (“Proposed Joint Venture”).

The share capital of ATS will upon satisfaction or waiver of the conditions precedent set out in the SSA be increased to €1,000,000 comprising 1,000,000 shares of €1.00 par value each and, will be subscribed  for in cash  by AACE and BH as follows:

The investment in ATS will be financed through internally generated funds.

Information of APM Auto Components Europe B.V.

AACE was established as a private limited company under the laws of the Netherlands and has a registered share capital of €10,000 divided into 10,000 shares of par value €1.00 each. AACE is an investment subsidiary of APM Automotive Global Limited (“AAGL”)(formerly known as “APM Automotive Australia Limited”), which in turn is a wholly-owned subsidiary of APM.

Information of Bent Holding B.V.

BH was established as a private limited company under the laws of the Netherlands on 2 February 2010 and has a registered share capital of €18,000 divided into 18,000 shares of par value €1.00 each. BH is the holding company of TS-Automotive B.V., and is the holder of the TUV certifications.

Rationale, risk factors and prospects involved in the Proposed Joint Venture

The Proposed Joint Venture arrangement is to jointly develop and grow the business of ATS upon the completion of the Proposed Acquisition and augurs well with the Group’s plan to expand its business outside Malaysia and is expected to contribute positively to the profitability and growth of APM Group in the future. There is no special risk associated with the Proposed Acquisition other than operational risks.

Duration of the Proposed Joint Venture

The Proposed Joint Venture is effective from the date of satisfaction or waiver of the conditions precedent set out in the SSA unless terminated (i) as a result of transfer of shares made in accordance with the SSA that shareholder who is the transferor holds no shares in the capital of ATS or (ii) on the occurrence of a default by a party such as the commitment of a material breach of its obligations, insolvency, inability to pay its debts among others, which is not resolved within 90 days or (iii) with the consent of the other party.  

Financial Effects of the Proposed Acquisition and Proposed Joint Venture

The Proposed Acquisition and Proposed Joint Venture will have no material effect on the earnings per share, net assets per share, gearing, share capital and substantial shareholders’ shareholding of APM for the financial year ending 31 December 2015.  However, the Proposed Joint Venture is expected to contribute positively to the future earnings of APM Group.

Approvals Required

The Proposed Acquisition and Proposed Joint Venture are not subject to the approval of the shareholders of APM or any regulatory authorities.

Interest of Major Shareholders and Directors

None of the directors and/or major shareholders of APM and/or persons connected to them have any interest, direct or indirect, in the Proposed Acquisition and Proposed Joint Venture.

Statement by the Board of Directors

The Board of Directors of APM is of the opinion that the Proposed Acquisition and Proposed Joint Venture are in the best interest of APM Group.

This announcement is dated 13 November 2015.