KUALA LUMPUR (April 15): SkyGate Solutions Bhd (KL:SKYGATE), formerly Ewein Bhd, is buying a 51% stake in Leader Range Technology (LRT) for RM10.71 million in cash. In a share sale agreement signed on Tuesday, SkyGate said it will acquire 255,003 shares from founder and managing director Ong Chee Fui and Kumpulan Modal Perdana Sdn Bhd (KMP), along with all preference shares held by KMP.
As at April 10, 2025, LRT had an issued share capital of RM10.5 million comprising 500,002 ordinary shares and 9,999,999 redeemable convertible preference shares (RCPS).
SkyGate said it is paying RM1.526 million for the acquisition of 255,001 ordinary shares from Ong, along with one share each from KMP — a tech-focused venture capital firm under the purview of Ministry of Science, Technology and Innovation — and its wholly-owned subsidiary, E&E Catalyst Sdn Bhd.
Most of the RM10.71 million purchase price — RM9.18 million — will be used to buy 9.99 million preference shares (RCPS) owned by KMP’s two subsidiaries, E&E Catalyst and E&E Catalyst II Sdn Bhd.
No details regarding the conversion of the RCPS were disclosed.
On top of the transaction, SkyGate and Ong will also pay KMP RM2.2 million in cash for an advance it provided to LRT. Skygate will pay RM1.12 million, by way of a loan to LRT, while Ong will pay RM1.08 million as a loan to LRT.
This marks KMP’s exit from LRT, a company that provides advanced test solutions by combining industrial automation with traditional testing equipment and custom fixtures.
LRT also specialises in the fabrication of complex industrial automation systems, high precision machine parts and sheet metal fabrication.
Once completed, Ong will own a 44% interest in LRT, Senandung Angkasa a 3% interest, while Sharp Capital Sdn Bhd will own the remaining 2%.
The deal is subject to among others, a legal and financial due diligence exercise on LRT within two months of the share sale agreement between SkyGate and Ong, KMP, E&E Catalyst and E&E Catalyst II, with an automatic one-month extension if needed.
If the checks uncover any major issues — defined as a drop of 5% or more in LRT’s net tangible assets as of Dec 31, 2024 — SkyGate can adjust the purchase price. If the full payment has already been made, Ong must refund the difference to Skygate.
SkyGate said the acquisition of LRT aligns with its long-term strategy to expand its portfolio, enhance operational capabilities, and strengthen its market position in the electrical and electronics sector, while leveraging synergies, shared resources, and economies of scale to optimise costs and drive profitability.
For the twelve months ended Dec 31, 2024 (FY2024), SkyGate made a total net profit of RM5.64 million, up from RM1.12 million a year ago, as its total revenue grew 75% to RM66.24 million from RM37.72 million in FY2023.
As of the end of 2024, the company held RM47.35 million in cash and fixed deposits, compared to total borrowings of RM115.34 million.
Datuk Ooi Eng Leong is the largest shareholder of SkyGate, with a 42.75% stake. He first became its largest shareholder in June 2023, after increasing his stake from 3.84% to 43.82%.
Ooi is also managing director and a major shareholder in NationGate Holdings Bhd (KL:NATGATE), owning 54.75% of the company.
The next largest shareholders in SkyGate are Hong Yeam Wah, with a 4.69% stake, and Goh Kiang Teng, with a 4.18% stake.
Shares of SkyGate were unchanged at 53 sen by Tuesday's closing, giving it a market capitalisation of RM169.37 million. Year-to-date, the stock has fallen 42.4%.