KUALA LUMPUR: D&O Green Technologies Bhd
has managed to secure the coveted additional 27.95% stake in light emitting diode (LED) maker Dominant Opto Technologies Sdn Bhd for RM275.21mil.
D&O, which in August made an offer to several Dominant shareholders to buy out their shares, saw its offer for the shares (at RM8.95 each) accepted by all of the offerees as of the closing date on Tuesday.
This would boost D&O’s stake in Dominant - its principal operating subsidiary that produces LEDs at a state-of-the-art facility in Batu Berendam, Melaka - to 89.8%, it told Bursa Malaysia.
The latest Dominant shareholder to accept the offer was Golden Horizon Resources Ltd (GHRL), which is owned by D&O’s major shareholders Goh Nan Yang (also a D&O director) and Lim Yam Chiew.
D&O said GHRL would be paid RM107.4mil for its 10.91% stake. It is the single biggest block of shares among the parties that sold off their stakes.
All the shareholders who accepted the offer will be paid by the issuance of new irredeemable convertible preference shares (ICPS) in D&O.
GHRL has given its written undertaking that it will not convert its ICPS if that would lead to the percentage of public shareholding in D&O to fall below or to fall further below the public shareholding spread as allowed by Bursa Securities.
Based on D&O’s earlier announcement, the acquisition of the shares is expected to be completed in the first quarter of 2018.
According to D&O’s latest annual report, it was three years ago that Dominant decided to gradually exit the highly competitive and less profitable LED markets for general lighting and LED TV to focus on its core competency in the automotive segment.
“The transformation has yielded very positive results. Operating profit grew at a 61% compounded annual growth rate from RM8mil in 2013 to RM32mil in 2016 on the back of a slower 9.5% compound annual growth rate in revenue from RM328mil in 2013 to RM430mil in 2016,” it said in the 2016 report issued in April.
