KUALA LUMPUR (Sept 23): Hamburg-based chemical marketing firm Helm AG is subscribing for shares of Ancom Nylex Bhd (KL:ANCOMNY) that will give it control of 9.47% of the agricultural machinery manufacturer's shares through a private placement.
Helm, whose sole shareholder is its chief executive officer Stephan Schnabel, is taking up 96.22 million new Ancom Nylex shares at an issue price of RM1 under a conditional placement agreement inked on Monday, according to Ancom Nylex's filing to the local stock exchange on Monday.
As Ancom Nylex's issued share capital stood at RM409.77 million comprising 932.25 million shares as at Sept 3 — excluding 80.14 million treasury shares — the group intends to resell 30 million treasury shares to the open market before implementing the proposed placement, so the shares it places out to Helm will come to about 10% of its total issued shares.
Post-placement, Ancom Nylex's total issued shares will rise to 1.06 billion, with Helm’s shareholding increasing from 0.43% currently to 9.47%.
This will dilute the shareholding of Ancom Nylex's two largest shareholders — executive vice-chairman Datuk Siew Ka Wei and CEO cum managing director Lee Cheun Wei. Siew's stake will be trimmed from 16.86% to 14.86%, while Lee's will drop from 10.72% to 9.45%.
The issue price of RM1 takes into consideration prevailing market conditions and Ancom Nylex's five-day volume weighted average market price (up to and including Sept 20) of RM1.05, after adjusting for two dividend payouts announced this year that amounted to five sen per share, according to Ancom Nylex.
Ancom Nylex plans to use proceeds from the private placement to repay borrowings (RM56 million), and for working capital (RM39.2 million). The group expects to complete the private placement by the fourth quarter of 2024.
With Helm becoming a substantial shareholder, the group is well-positioned to accelerate its growth as an integrated chemicals player, said Lee in a statement. “Helm AG is a leading global chemical player with a strong presence and expertise in the agricultural chemicals (agrichem) sector. They are also active in our current export markets, which allows us to expand both new and existing markets with an enlarged product portfolio."
Siew said Helm AG would bring fresh ideas and high corporate governance standards to the partnership. “With the combined strengths of Ancom Nylex and Helm AG, we are confident we can reach new heights in the agrichem and industrial chemicals sectors,” he added.
Helm's Schnabel said the partnership offers a strategic opportunity to expand their presence in Southeast Asia’s chemicals and agricultural sectors.
“We are enthusiastic about the vast business potential, creating added value, and making a significant impact in the chemical and agricultural markets. We look forward to turning these opportunities into mutually beneficial and tangible results,” he said.
Shares in Ancom Nylex closed two sen or 1.85% lower at RM1.06, giving the group a market capitalization of RM1.08 billion.