KUALA LUMPUR (July 13): Milux Corporation Bhd (KL:MILUX) has proposed to acquire smart home appliance rental and retail company Movon Sdn Bhd for RM150 million in an all-share transaction.

The home appliance manufacturer is acquiring the entire issued share capital of Movon from Abletech Solutions Sdn Bhd and Datuk Dr Lim Jee Gin through the issuance of 220.59 million new Milux shares at 68 sen apiece, according to a bourse filing on Monday.

Abletech Solutions is selling its 91.4% stake in Movon, while Lim is disposing of the remaining 8.6% interest.

Movon, incorporated in 2021, is principally involved in the rental and retail of home appliances and household products under the "Movon" brand, offering Internet-of-Things-enabled smart home appliances such as washing machines, refrigerators, air conditioners and smart door locks, as well as premium baby strollers and child car seats.

Movon's business is supported by a rent-to-own (R2O) model, allowing customers to pay through periodic instalments before taking ownership of the products.

Milux said the proposed acquisition is aligned with its strategy to strengthen its position in the home appliances and household products segment by broadening its product offerings and distribution capabilities.

"The proposed acquisition will enable Milux to expand its distribution channel with immediate access to Movon's direct selling and distribution network, which is supported by nationwide registered sales agents," the company said.

It added that the deal would also allow the company to leverage Movon's established R2O infrastructure, providing customers with greater payment flexibility through lower upfront costs compared with conventional outright purchases.

Following the acquisition, the enlarged group is expected to offer a broader range of products, a multi-channel distribution network and more flexible payment options, while gaining access to new customer segments, including lower-income households and technology-savvy consumers.

"The Movon group is an operating business with an established revenue base and the consolidation of its financial results is expected to enhance the earnings base of the enlarged Milux group going forward," Milux said.

It added that settling the purchase entirely through shares would preserve its cash reserves for ongoing and future operations.

As part of the transaction, the vendors have provided a profit guarantee requiring Movon to achieve an audited profit after tax of at least RM8 million for the financial year ending Dec 31, 2026 (FY2026), RM15 million for FY2027 and a cumulative RM23 million over the two years. Milux will retain 33.82 million consideration shares in trust as security until the guarantees are met.

Upon completion, Milux's issued share capital will nearly double to 455.65 million shares from 235.06 million shares currently, while its public shareholding spread is expected to increase to about 29.2% from 25.8%.

Shares of Milux closed unchanged at 69.5 sen on Monday, with a market capitalisation of RM163.4 million.