Tasik Puncak LP was established as a special purpose vehicle for DAPE to subscribe for the Placement Shares.

Transcription

1 SPRITZER BHD ("SPRITZER" OR THE "COMPANY") PROPOSED PRIVATE PLACEMENT OF 27,387,225 NEW ORDINARY SHARES IN SPRITZER ("SPRITZER SHARE(S)") ("PLACEMENT SHARE(S)"), REPRESENTING 15% OF THE ISSUED SHARES OF SPRITZER (EXCLUDING TREASURY SHARES), AT AN ISSUE PRICE OF RM2.33 PER PLACEMENT SHARE ("PROPOSED PRIVATE PLACEMENT") 1. INTRODUCTION On behalf of the Board of Directors of Spritzer ("Board"), UOB Kay Hian Securities (M) Sdn Bhd ("UOBKH") wishes to announce that the Company had on 21 September 2017 entered into a subscription agreement with Tasik Puncak Holdings Ltd ( Tasik Puncak Holdings ) for a proposed private placement of 27,387,225 Placement Shares, representing 15% of the issued shares of Spritzer (excluding 24,000 treasury shares), at an issue price of RM2.33 per Placement Share ("Subscription Agreement"). Tasik Puncak Holdings is entering into the subscription agreement in its capacity as the sole general partner Tasik Puncak Holdings, L.P ( Tasik Puncak LP ) and will be holding the Placement Shares for and on behalf of Tasik Puncak LP. 2. DETAILS OF THE PROPOSED PRIVATE PLACEMENT 2.1 Information on Tasik Puncak LP Tasik Puncak LP was registered in the Cayman Islands on 28 July 2017 under the Exempted Limited Partnership Law of the Cayman Islands as an exempted limited partnership with its registered office at PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands. The principal activity of Tasik Puncak LP is investment holding. As at 20 September 2017, being the latest practicable date prior to this announcement ( LPD ), Tasik Puncak LP does not have any subsidiaries. As at the LPD, the sole limited partner of Tasik Puncak LP is Dymon Asia Private Equity (S.E. Asia) Ltd ( DAPE ) (as general partner for and on behalf of Dymon Asia Private Equity (S.E. Asia) Fund, L.P.). Tasik Puncak LP was established as a special purpose vehicle for DAPE to subscribe for the Placement Shares. Further details of DAPE are set out in Section 2.3 below. 2.2 Information on Tasik Puncak Holdings Tasik Puncak Holdings was incorporated in the Cayman Islands on 21 July 2017 under the Companies Law of the Cayman Islands as an exempted company with limited liability with the registered address at PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands. Tasik Puncak Holdings is the sole general partner of Tasik Puncak LP. As at the LPD, the sole director of Tasik Puncak Holdings is Jason Eng. Jason Eng does not hold any shares in Tasik Puncak Holdings or any limited partnership interests in Tasik Puncak LP. 1

2 2.3 Information on DAPE DAPE is managed by Dymon Asia Capital (Singapore) Pte. Ltd., a Singapore-based fund manager which manages several alternative investment funds with aggregate notional assets under management and committed capital of approximately USD5.3 billion as at 1 September 2017, through its private equity division, Dymon Asia Private Equity. DAPE has commitments of approximately SGD300 million and invests in companies across Southeast Asia. DAPE is currently invested in and manages a portfolio of investments spanning various industries, including the consumer, and food and beverage sectors. DAPE s investments in these sectors include Select Group Pte Ltd (a leading food service provider based in Singapore, with operations in Malaysia), Advend Systems Pte Ltd (a leading independent vending machine owner and operator in Singapore and Malaysia) and Greenday Group Co., Ltd (a fruit and vegetable snack company based in Thailand). 2.4 Placement size The total issued shares of Spritzer (excluding 24,000 treasury shares) as at the LPD is 182,581,502 Spritzer Shares. The Proposed Private Placement involves an issuance of 27,387,225 Placement Shares which will increase the issued shares of Spritzer (excluding 24,000 treasury shares) to 209,968,727 Spritzer Shares upon completion of the Proposed Private Placement. Tasik Puncak Holdings currently does not hold any shares in Spritzer and will emerge as a 13.04% substantial shareholder upon the completion of the Proposed Private Placement. Further, the Board of Spritzer has undertaken to retain the treasury shares and will not cancel or resell the treasury shares in the open market until the completion of the Proposed Private Placement. Further details on the effects of the Proposed Private Placement are set out in Section 4 of this announcement. 2.5 Basis of determining and justification for the issue price of the Placement Shares The Placement Shares are proposed to be placed out at an issue price of RM2.33 per Placement Share. The issue price of RM2.33 per Placement Share was arrived at between Spritzer and Tasik Puncak Holdings on a willing-buyer willing-seller basis after taking into consideration the prevailing market price and the future prospects of the Company. 2

3 The issue price of RM2.33 per Placement Share represents a premium of approximately 8.37% to the 5-day volume weighted average market price ( WAMP ) of Spritzer Shares up to and including 20 September 2017 of RM2.15 per Spritzer Share (being the last full trading day preceding the execution of the subscription agreement). In addition, the issue price of the Placement Shares represents the following premium/ (discount) to the historical share prices of Spritzer Shares:- Share price Premium/ (Discount) RM RM % Last transacted price of Spritzer Shares as at 20 September day WAMP of Spritzer Shares up to and including 20 September month WAMP of Spritzer Shares up to and including 20 September month WAMP of Spritzer Shares up to and including 20 September month WAMP of Spritzer Shares up to and including 20 September month WAMP of Spritzer Shares up to and including 20 September (0.01) (0.43) 2.34 (0.01) (0.43) (Source: Bloomberg) The issue price of RM2.33 per Spritzer Share represents the following valuation multiples: Based on the audited profit after tax and net assets for the financial year ended 31 May 2016 Based on the audited profit after tax and net assets for the 7- month financial period ended 31 December 2016 Earnings per share *1 Net assets per share *1 Price-toearnings ratio Price-tobook ratio sen RM times times * Note: *1 Computed based on the existing issued share capital of 182,581,502 Spritzer Shares (excluding 24,000 treasury shares). *2 Annualised. 2.6 Ranking of the Placement Shares The Placement Shares will, upon allotment and issuance, rank pari passu in all respects with the then existing Spritzer Shares, save and except that the Placement Shares will not be entitled to any dividends, rights, allotments and/ or other forms of distribution that may be declared, made or paid for which the entitlement date precedes the date of allotment and issuance of the Placement Shares. 3

4 2.7 Listing of and quotation for the Placement Shares An application will be made to Bursa Malaysia Securities Berhad ("Bursa Securities") for the listing of and quotation for the Placement Shares on the Main Market of Bursa Securities. 2.8 Utilisation of proceeds Based on the issue price of RM2.33 per Placement Share, the Proposed Private Placement is expected to raise gross proceeds of approximately RM63.81 million. The proceeds are intended to be utilised by Spritzer and its subsidiaries ( Spritzer Group ) in the manner as set out below:- Details of utilisation Time frame for utilisation upon completion Amount of proceeds RM'000 Construction of an automated warehouse *1 Within 36 months 45,000 Working capital *2 Within 24 months 18,612 Estimated expenses in relation to the Proposed Private Placement *3 Within one 1 month 200 Total 63,812 Notes:- *1 The proceeds are intended to be utilised to fund the expansion of the warehouse facilities of the Spritzer Group located at Taiping by constructing a single storey automated warehouse adjacent to the current facilities of the Spritzer Group. The new automated warehouse is expected to have a built up area of approximately 105,820 square feet ( sq ft ). For avoidance of doubt, the cost of constructing the automated warehouse will not include land cost as it will be constructed on the land currently owned by the Spritzer Group. The funds set aside is for the building cost and cost of setting up an automated storage and retrieval system. As at the LPD, Spritzer has not submitted any application to authorities for the construction of the automated warehouse and the application is expected to be made by first quarter of 2018 (upon the completion of the Proposed Private Placement). The actual cost of construction of the automated warehouse may vary depending on the actual layout. Any variation in the actual amount utilised will be adjusted to/from the Company s working capital requirement. *2 The gross proceeds earmarked for working capital of Spritzer are intended to be utilised to partially defray the expenses for its day-to-day operations in the following manner:- Note RM'000 Procurement of raw materials (a) 13,028 Other operating expenses (b) 5,584 Total 18,612 (a) (b) These raw materials include plastic resin and other packaging materials. Defrayment of operational expenses mainly for the upkeep of machineries, motor vehicles and buildings, utilities costs and other staff related expenses. The actual amount to be utilised by each component of working capital may differ subject to the operating requirements at the time of utilisation. *3 The estimated expenses consist of professional fees, fees payable to authorities, placement fee and other incidental expenses in relation to the Proposed Private Placement. Any variation in the actual amount of expenses will be adjusted to/from the Company s working capital requirement. 4

5 Pending the utilisation of proceeds from the Proposed Private Placement for the above purposes, the proceeds would be placed in deposits with financial institutions or shortterm money market instruments. 2.9 Salient terms of the Subscription Agreement The salient terms of the Subscription Agreement are set out below: Subscription Price Subject to the terms and conditions of the Subscription Agreement, Tasik Puncak Holdings agrees to subscribe for the Placement Shares at the subscription price of RM2.33 per Placement Share, amounting to a total sum of RM63,812,234 ( Subscription Price ) Conditions precedent The allotment and issuance of the Placement Shares is subject to the following conditions being fulfilled:- (a) (b) Spritzer furnishing to Tasik Puncak Holdings a copy of the approval-inprinciple from Bursa Securities for the listing of and quotation for the Placement Shares; and the approval of the shareholders of the Company for the Proposed Private Placement. The Conditions Precedent would have to be obtained or fulfilled within 90 days from the date of the Subscription Agreement, or such other date as may be mutually agreed upon by both parties in writing. Otherwise, the Subscription Agreement shall terminate, be null and void, and no further effect whatsoever and none of the parties will have any claims against each other under the Subscription Agreement Completion and Payment Tasik Puncak Holdings shall pay the Subscription Price to UOBKH as the placement agent ( Placement Agent ) within 5 business days from the fulfilment of the last Condition Precedent ( Payment Date ). The Company shall do the following within 5 business days from the Payment Date ( Completion Date ):- (a) (b) (c) issue and allot the Placement Shares to Tasik Puncak Holdings; deliver, or cause to be delivered to Bursa Malaysia Depository Sdn Bhd ( Bursa Depository ) the share certificates registered in the name of Bursa Depository for the Placement Shares; and instruct and procure Bursa Depository to credit the securities account of Tasik Puncak Holdings with the Placement Shares. 5

6 Completion of the subscription of the Placement Shares for the Subscription Price will occur on the listing date of the Placement Shares ( Completion ). In the event the listing of the Placement Shares cannot be done, for any reason whatsoever, on the Completion Date or on such deferred date pursuant to paragraph herein, the Company shall procure the Placement Agent to refund in full the Subscription Price to Tasik Puncak Holdings immediately upon the receipt of such a notice from Bursa Depository or Tasik Puncak Holdings, whichever is earlier. On Completion, the Company shall authorise and procure the Placement Agent to release the Subscription Price to the Company Non-compliance Without prejudice to any other remedies available to the parties, if in any respect the provisions of paragraph (as the case may be) are not complied with by the Company or Tasik Puncak Holdings (as the case may be) on the Payment Date, or the Completion Date (as the case may be), the Company or Tasik Puncak Holdings (as the case may be) may, subject to applicable laws, regulations or the Main Market Listing Requirements by Bursa Securities:- (a) defer Completion to a date not more than 28 days after the Payment Date or the Completion Date (as the case may be) (and so that the provisions herein shall apply to Completion as so deferred); (b) proceed to Completion so far as practicable (without prejudice to its rights hereunder); or (c) rescind the Subscription Agreement and claim for the actual costs and expenses incurred by the non-defaulting party in relation to the Subscription Agreement Nomination of director Spritzer will ensure that Tasik Puncak Holdings is entitled to nominate a nominee director as non-independent non-executive director (or such alternate director) of the Board of the Company for as long as Tasik Puncak Holdings holds at least 10% of the issued shares in Spritzer (excluding Spritzer Shares held in treasury) and such nominee (or the alternate director) shall be acceptable to the Nomination Committee of Spritzer and approved by the Board, and meets the requirements set out in the Main Market Listing Requirements by Bursa Securities. For the avoidance of doubt, in the event a nominee director or such alternate director appointed by Tasik Puncak Holdings resigns or is disqualified from holding office or the office of the nominee director or such director s alternate become vacant, or does not meet the requirements of the Nomination Committee of Spritzer and the Main Market Listing Requirements by Bursa Securities, Tasik Puncak Holdings shall be entitled to nominate a replacement candidate for consideration and approval by the Nomination Committee of Spritzer and the Board in accordance with the provisions of this clause. 3. RATIONALE AND JUSTIFICATION FOR THE PROPOSED PRIVATE PLACEMENT The Placement Shares are intended to be placed to Tasik Puncak Holdings, which is a special purpose vehicle of DAPE, a private equity firm focusing on making private equity investments in the Southeast Asia region. 6

7 DAPE invests in companies across Southeast Asia, concentrating on businesses which have strong business fundamentals and favourable growth prospects. DAPE seeks to tailor its investments to the needs of its investee companies with a strong focus on partnering with the business and meeting long-term objectives. The DAPE investment team has an established track record in investments, and also operational and strategic value add with companies in the consumer and food and beverage industries in Asia and in particular Southeast Asia, especially in Malaysia, Singapore, Thailand and China. DAPE hopes to contribute its industry experience as well as its broad networks to support the Spritzer Group in its future growth plans. Accordingly, Tasik Puncak Holdings intends to appoint a nominee director to the Board based on the terms set out in the Subscription Agreement (details of the terms are set out in Section of this announcement) and is expected to assist the Board of Spritzer on the future growth plans of Spritzer which may include product marketing in new markets and potential mergers and acquisitions with suitable companies. Further, the Proposed Private Placement is expected to raise proceeds of approximately RM63.81 million of which approximately RM45.00 million is intended to be utilised for the construction of an automated warehouse which is expected to be constructed adjacent to the existing facility located at Taiping. Spritzer will be able to increase its warehouse space by approximately 105,820 sq ft. This will enable the Spritzer Group to increase the warehousing capacity of the Spritzer Group, improve productivity and increase the efficiency of the warehouse. The Proposed Private Placement would also allow the Company to raise equity funds for the construction of the warehouse and working capital without incurring interest expenses or service principal repayment as compared to conventional bank borrowings. This would allow the Company to preserve cash flow for reinvestment and/or operational purpose. 4. EFFECTS OF THE PROPOSED PRIVATE PLACEMENT 4.1 Issued share capital The proforma effects of the Proposed Private Placement on the issued share capital of the Company are set out below:- No. of Shares RM Issued share capital as at the LPD 182,605, ,758,421 Less: Treasury shares (24,000) (13,832) 182,581, ,744,589 Shares to be issued pursuant to the Proposed Private Placement 27,387,225 63,812,234 Enlarged issued share capital (excluding treasury shares) 209,968, ,556,823 7

8 4.2 NA per share and gearing Based on the latest audited consolidated statements of financial position of Spritzer Group as at 31 December 2016, and after taking into consideration the movements in the share capital of Spritzer up to and including the LPD, the proforma effects of the Proposed Private Placement on the NA per share and gearing of the Group are set out below:- I II Audited as at 31 December 2016 After adjusted for the movements in share capital and payment of dividend up to the LPD After I and the Proposed Private Placement RM'000 RM'000 RM'000 Share capital 89, ,758 *1 216,571 Treasury shares (14) (14) (14) Share premium 56, Equity-settled employee benefits 1,345 - *2 - reserve Translation reserve (34) (34) (34) Retained earnings 140, ,514 *3 134,314 *4 Shareholders' funds/ NA 288, , ,837 Number of shares outstanding in issue (excluding treasury shares) ('000) 179, , ,969 NA per share (RM) Total borrowings (RM'000) 20,054 20,054 20,054 Gearing ratio (times) Notes:- *1 After adjusted for the following:- i. Issuance of a total of 3,032,500 new Spritzer Shares arising from the exercise of the options granted pursuant to the employees' share option scheme of the Company ("ESOS"). For shareholders' information, the ESOS has expired on 8 March ii. With the Companies Act, 2016 ( Act ) which came into effect on 31 January 2017, the entire credit standing in the share premium account became part of the share capital account. *2 The equity-settled employee benefits reserve was reduced by RM1,189,000 from the exercise of employees share option scheme which will be capitalised (transferred to share capital) and RM156,000 from the recognition of share based payment which is transferred to the retained earnings account. *3 Payment of dividend of 3.5 sen per Spritzer Share amounted to approximately RM6.39 million on 23 June *4 After deducting estimated expenses of RM200,000 in relation to the Proposed Private Placement. THE REST OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK 8

9 4.3 Substantial shareholding structure The effects of the Proposed Private Placement on the substantial shareholders' structure of Spritzer are set out below:- I Shareholdings as at the LPD After the Proposed Private Placement < Direct > < Indirect > < Direct > < Indirect > Substantial shareholders No. of Shares % No. of Shares % No. of Shares % No. of Shares % Yee Lee Corporation Bhd ("YLC") 58,553, ,553, Yee Lee Holdings Sdn Bhd ("YLH") 22,811, ,811, Dato' Lim A Lim Kok Cheong ("Dato' LKC") 9,147, ,629,491 * ,147, ,629,491 * Dato' Lim Kook Boon ("Dato' LKB") 7,014, ,308,299 * ,014, ,308,299 * Datin Chua Shok Chua Siok Hoon ("Datin CSH") 2,110, ,666,198 * ,110, ,666,198 * Datin Lai Yin Leng ("Datin LYL") 233, ,089,766 * , ,089,766 * FMR LLC 10,125, ,125, Yee Lee Organization Bhd ("YLO") ,364,994 * ,364,994 * Unikampar Credit and Leasing Sdn Bhd ("UCL") ,364,994 * ,364,994 * Uniyeelee Sdn Bhd ("UYL") ,364,994 * ,364,994 * Yeleta Holdings Sdn Bhd ("YH") ,364,994 * ,364,994 * Young Wei Holdings Sdn Bhd ("YW") ,364,994 * ,364,994 * Tasik Puncak Holdings ,387,

10 Notes:- *1 Deemed interest by virtue of his shareholdings in Chuan Sin Resources Sdn Bhd ("CSR") and YW; and the shares held by his spouse, Datin CSH and children, Lim Ee Young and Lim Ee Wai in the Company. *2 Deemed interest by virtue of his shareholding in CSR; and the shares held by his spouse, Datin LYL and children, Lim Seng Lee and Lim Hock Lai in the Company. *3 Deemed interest by virtue of her shareholding in YW and deemed shareholding in CSR; and the shares held by her spouse, Dato' LKC and children, Lim Ee Young and Lim Ee Wai in the Company. *4 Deemed interest by virtue of her shareholding in CSR; and the shares held by her spouse, Dato' LKB and children, Lim Seng Lee and Lim Hock Lai in the Company. *5 Deemed interest held through YLC and YLH. *6 Deemed interest held through YLO. *7 Deemed interest held through UCL. *8 Deemed interest held through YH. t THE REST OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK 10

11 4.4 Earnings and earnings per share ("EPS") The Proposed Private Placement, which is expected to be completed by the fourth quarter of 2017, is not expected to have any material effect on the earnings of Spritzer Group for the financial year ending 31 December However, there will be a corresponding dilution in the EPS of the Group for the financial year ending 31 December 2017 as a result of the increase in the number of Spritzer Shares pursuant to the Proposed Private Placement. 4.5 Convertible securities As at the LPD, the Company does not have any existing convertible securities. 5. APPROVALS REQUIRED The Proposed Private Placement is subject to the following approvals being obtained:- i. Bursa Securities, for the listing of and quotation for the Placement Shares on the Main Market of Bursa Securities; and ii. The shareholders of Spritzer, for the Proposed Private Placement at an extraordinary general meeting ("EGM") of the Company to be convened. The Proposed Private Placement is not conditional upon any other proposals undertaken or to be undertaken by the Company. The voting on the resolution in relation to the Proposed Private Placement at the EGM will be taken via poll. 6. INTERESTS OF DIRECTORS, MAJOR SHAREHOLDERS AND/ OR PERSONS CONNECTED TO THEM None of the Directors and/ or major shareholders of Spritzer and/ or persons connected to them have any interests, whether direct or indirect, in the Proposed Private Placement. 7. DIRECTORS' STATEMENT The Board, having considered all aspects of the Proposed Private Placement, including the rationale and justification, the utilisation of proceeds and the effects of the Proposed Private Placement, is of the opinion that the Proposed Private Placement is in the best interest of the Company. 8. ESTIMATED TIME FRAME FOR COMPLETION Barring any unforeseen circumstances and subject to all relevant approvals being obtained, the Proposed Private Placement is expected to be completed by the fourth quarter of APPLICATION TO THE AUTHORITY Barring any unforeseen circumstances, the applications to the relevant authorities in relation to the Proposed Private Placement is expected to be made within a period of 2 months from the date of this announcement. 11

12 10. ADVISER AND PLACEMENT AGENT UOBKH has been appointed as the adviser and placement agent for the Proposed Private Placement. 11. DOCUMENT AVAILABLE FOR INSPECTION A copy of the Subscription Agreement will be made available for inspection at Spritzer's registered office at Lot 85, Jalan Portland, Tasek Industrial Estate, Ipoh, Perak Darul Ridzuan, during normal business hours from Mondays to Fridays (except public holidays) for a period of 3 months from the date of this announcement. This announcement is dated 21 September