CFA Society Singapore
SINGAPORE (Dec 12): Datapulse Technology is transforming itself to a manufacturer of haircare and cosmetics products from a manufacturer of CD and DVD products.
On Tuesday, Datapulse entered into a share purchase agreement with Way Company for the purchase of a 100% stake in Malaysia-based Wayco Manufacturing for a cash consideration of $3.5 million.
Wayco Manufacturing also owns three properties where its production facilities are located, one in Selangor and two in Johor Bahru.
For the six month ended June, Wayco Manufacturing has an unaudited net profit after tax of RM160,632 ($53,201) and an unaudited net tangible asset value of RM7.6 million ($2.5 million) as at end June.
In a filing on Tuesday night, Datapulse says it is in the interests of the company and its shareholders to consider diversifying its core businesses to include other businesses as its current business remains challenging.
"The Board is of the view that the Proposed Acquisition is opportune for the Company to acquire a profitable business and diversify its core business into the beauty/wellness products or industry, which should have reasonable prospects for growth," says Datapulss.
CEO Kee Swee Ann was also the former general manager of the seller Way Company from 2008 to 2010 and was involved in the management of Wayco Manufacturing during the tenure of his employment.
"The company intends to seek shareholders’ approval for a proposed diversification of the core businesses of the company and propose change of name," adds Datapulse.
Datapulse made the decision to diversify its business after a boardroom shakeup following the termination of the company’s option to purchase an industrial property at Toa Payoh to relocate its existing manufacturing business at Tai Seng Drive as well as the emergence of Ng Siew Hong as a new substantial shareholder of the company with a 29% stake.
Shares in Datapulse closed at 33 cents on Tuesday.