What else thy gonna SELL

Maybe WPI [err, SJER or NSER], NECR and ECER (or whatever so-called ER’lah) is not enough for Hj. Abdullah Ahmad Badawi anak menantu & Co. to make easy profit. Looks like thy running out of fund time yaa, e’thing must be CLEAR before this coming GE.

So pls. come in S’pore… We’re selling off cheaply our sovereignty.

Temasek set to acquire LKT

By YVONNE TAN

PETALING JAYA: A Temasek Holdings (Pte) Ltd-linked company is expected to soon acquire a substantial stake in Penang-based LKT Industrial Bhd into which it would inject a substantial manufacturing business, a source said.

He said the manufacturing business was a “long-term, stable and lucrative” one that was expected to stand alongside LKT’s existing core business of cyclical semiconductor equipment as one of the two major revenue contributors of the company moving forward.

Temasek is the investment arm of the Singapore Government with companies of diverse industries under its stable.

The source said the new shareholder was expected to take up a stake of about 33% in LKT, with the price ranging from RM3 to RM3.50 per share. The Temasek group’s acquisition could result in it making a general offer at RM3.50 a share.

To this end, industry sources have indicated that Temasek would buy LKT shares from Lembaga Tabung Haji, its second largest shareholder with a 19.52% stake, and from its current single largest shareholder, executive chairman Datuk Loh Khee Lian, who has a direct stake of 23.54%.

“Loh’s stake will therefore be reduced after Temasek’s acquisition,” they said. While discussions continue, terms are close to being finalised and Temasek’s acquisition could be announced as early as this week.

The introduction of a new business for LKT is expected to be revealed at a later date.

The synergy with Temasek could come from diverse directions in the wide-ranging business activities of the Singaporean group. In the electronics sector, Temasek is a major shareholder of Chartered Semiconductor Manufacturing, a semiconductor foundry, and STATS ChipPac Ltd, a service provider of semiconductor packaging.

It is also noted that LKT has expertise and experience in the manufacture of the aircraft components. Temasek group is a global player in this field.

Its member company, Singapore Technologies Engineering Ltd (ST Engineering), is said to be the world’s largest company engaged in aircraft maintenance, repair and overhaul, or MRO as it is known in the industry.

”The new business will start contributing to LKT’s revenue, at the earliest, in the financial year ending Dec 31, 2008 (FY08) onwards. In the next two to three years, I am expecting about 50% of LKT’s revenue to come from this new business,” the source told StarBiz.

“Post-FY09, I am looking at sales doubling to more than RM500mil for the company,” he added.

LKT made a net loss of RM1.4mil on revenue of RM45.8mil in its second quarter ended June 30, compared with a net profit of RM9.6mil on revenue of RM70.3mil in the previous corresponding period, attributed mainly to softer equipment demand in the semiconductor industry.

The source attributed the new shareholder’s choice of LKT to the possibility that it had huge floor space and capacity, coupled with a record of having blue-chip multinational clientele.

Likewise, LKT will be able to leverage on Temasek’s vast business network.

Currently, LKT’s two plants have a combined floor space of 226,500 sq ft. The first plant was completed in September last year while the second was commissioned about two months ago.

LKT, according to analysts, did have the capability to continue to extend its original equipment manufacturer capabilities to service other industries, such as aerospace as well as medical and oil and gas. It currently does this on a small scale.

At the moment, it designs and manufactures automated equipment mainly for the semiconductor, hard disk drive and consumer electronics sectors.

Related:

Singapore Precision buys 27 million LKT shares

Singapore-listed firm buying into Tai Kwong

“Who cares about virginity nowadays, even I’m married with a widow‘” - signed Pak Lah

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