D&O Green Technologies to acquire electroplating firm Syntronixs in RM55mil deal

KUALA LUMPUR: D&O Green Technologies Bhd is buying a precision electroplating services company in Melaka for RM55mil.

In a filing with Bursa Malaysia today, D&O said it has made the takeover offer to the shareholder of Syntronixs Asia Sdn Bhd on Monday.

The offer, it said, was accepted today.

"Upon acceptance of the Offer, the company shall proceed to undertake a due diligence exercise in respect of Syntronixs and commence negotiation with the vendors on a definitive Share Purchase Agreement (SPA) and Option Agreement," D&O said.

Syntronixs offers precision electroplating services for the semiconductor industries. It provides effective surface cleaning solution and pre-surface- treatment process namely deflashing and descaling on parts prior to the plating process.

"Based on the latest audited financial statements of Syntronixs for the financial year ended Dec 31, 2020 Syntronixs registered a profit after tax attributable to the owners of Syntronixs of RM2.03mil," D&O said, while audited net assets attributable to the owners of Syntronixs was RM23.3mil.

Currently Syntronixs’ operation is located adjacent to D&O’s existing plant in Melaka. There is a vacant land area of approximately 9,000 m2 which will be available for the Group’s future expansion.

D&O said electroplating is one of the key manufacturing processes for Smart LED. "The acquisition will significantly reduce the future investment needs of the Group’s in-house electroplating facilities," it said.

"The Group also plans to use the acquired platform to expand into leadframe manufacturing through new investment in moulding facilities with capacity sufficient to supply up to 30% of the leadframe needs of Dominant Opto Technologies Sdn Bhd, a 90%-owned subsidiary of the Company," it added.

Leadframe is one of the key input materials for LED manufacturing. "The planned expansion into leadframe manufacturing will further increase the supply security of leadframe in Dominant’s supply chain management," D&O said.