Catalist-listed Jubilee Industries Holdings, the 53.07%-owned subsidiary of Accrelist, has entered into a shareholders’ agreement (SHA) with UPC Electronics on Oct 11.
The SHA was made to govern the respective rights and obligations, and regulate the parties’ relationships in the conduct of the business and related affairs of We Components.
Jubilee Industries Holdings had previously entered into a sale and purchase agreement (SPA) with UPC Electronics to dispose of 14% of its stake in We Components for a consideration of US$2.1 million ($3.0 million) on June 21.
In accordance with the SHA, Jubilee Industries has granted UPC two call options, with the first being the right to acquire 15.39 million shares in We Components for the consideration of US$8.4 million. The number of shares represents a 56% stake in We Components’ total share capital.
The consideration was calculated based on the disposal of Jubilee’s 14% stake for US$2.1 million.
The second option sees Jubilee Industries granting UPC the right to acquire 8.2 million shares – or 30% of We Components’ total stake – for US$5.4 million.
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This time, the consideration was calculated based on 30% of the sum of We Component’s FY2022 P/E ratio of US$1 million multiplied by 8 and its stock of US$10 million.
Meanwhile, UPC has granted Jubilee Industries two put options for the same.
In addition, it has granted Jubilee Industries a buyback option where it can acquire 19.2 million shares in We Components, representing a 70% stake for a consideration of US$10.5 million.
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On a pro forma basis, had the call and put options been completed by March 31 during the FY2022 ended March, Accrelist’s net tangible assets (NTA) per share would have been reduced to 11.40 cents (after the first call and put option) and 10.34 cents (if both call and put options had been exercised) from 14.15 cents before the options were exercised.
The company’s loss per share would have been at 3.40 cents (after the first call and put option) and 4.46 cents (if both call and put options had been exercised) from 0.65 cents before the options were exercised.
Shares in Accrelist and Jubilee closed at 3.7 cents and 2.7 cents respectively on Oct 12.