KUALA LUMPUR (Sept 23): Ancom Nylex Bhd(KL:ANCOMNY) expects that the emergence of Hamburg-based chemical marketing firm Helm AG as its substantial shareholder will enhance its presence in Europe, as well as in the North and South American markets.
In 2023, Ancom Nylex’s revenue from the European market came in at only RM375,000, while revenue from North and South America totalled RM127.6 million, representing just 0.02% and 6.24% of its total revenue of RM2.04 billion respectively.
“We have not been very active in Europe in the past. Since Helm is strong in the European market, we aim to leverage their market expertise and geographical reach to improve our performance there,” said Ancom Nylex chief executive officer and managing director Datuk Lee Cheun Wei during a media briefing on Monday.
Regarding the North and South American markets, Lee added that Ancom Nylex and Helm have no overlap despite both being present in the region. Ancom Nylex focuses on post-emergence products, while Helm AG specialises in pre-planting, burn-down and pre-emergence solutions.
“It is complementary, by combining our strengths, we can enter the market together with stronger, more comprehensive product offerings,” Lee said.
Lee further stated that Ancom Nylex’s bottom line could see a positive impact within two to three years after Helm became its substantial shareholder.
“Agrichemical products take time to get approval in different countries, so we expect the contribution to the bottom line to start within a year for some lower hanging fruit. However, the full financial impact should come in 24 to 36 months,” he added.
For the industrial petrochemical side, Ancom Nylex executive vice-chairman Datuk Siew Ka Wei said it could bear fruit within a shorter time frame.
“Unlike agrichemicals, industrial petrochemicals like methanol are easier to sell and do not face as many hurdles. So, the contribution to the bottom line will come much faster,” Siew noted.
On Monday, Ancom Nylex announced that Helm is subscribing to shares that will give it a 9.47% stake in the agricultural machinery manufacturer through a private placement.
Helm AG’s sole shareholder and CEO Stephan Schnabel, is acquiring 96.22 million new Ancom Nylex shares at RM1 each under a conditional placement agreement.
Schnabel confirmed that Helm AG will subscribe to the 30 million treasury shares Ancom Nylex intends to resell before completing the private placement.
This will result in Helm holding approximately a 13% stake in Ancom Nylex, according to Schnabel.
He also said that Helm has no plans to further increase its shareholding in Ancom Nylex at this time but intends to seek a seat on Ancom Nylex's board in the near future.