The Week That Was

Inari to up OSAT business in China

Inari Amertron Bhd said it has teamed up with a Chinese private equity firm to expand its outsourced semiconductor assembly and test (OSAT) business in China.

Under the memorandum of understanding (MoU), the company will inject RM300mil cash and its 100% stake in Amertron Technology Kunshan (ATK) for a 55% equity interest in the proposed OSAT joint-venture company (JVCo).

Inari had an estimated RM900mil cashpile as at end-June and had raised RM1bil from a private placement in July.

Its partner China Fortune-Tech Capital Co Ltd (CFTC) will contribute about RM486mil cash and 100% equity shares of Yiwu Semiconductor International Corp, valued at RM14mil, for its 45% share in the JVCo. Reports indicated that a definitive agreement will be signed within six months.

ATK contributes about 8% of Inari’s total revenue.

Under the MoU, plans are in the pipeline to double ATK’s factory floor space in China next year, which should provide a huge earnings boost for the company.

AAX sets Nov 12 as meeting date

AirAsia X Bhd (AAX) told the stock exchange on Monday that it had set Nov 12 for creditor meetings to vote on the restructuring proposal.

According to Reuters, the embattled long-haul budget carrier has proposed to pay just 0.5% of debt owed to each of its creditors and to terminate all existing contracts so that it can restructure RM33.65bil of liabilities.

Half of the total liability is the cost of terminating airplane orders from its largest creditor Airbus SE for 78 A330neo widebodies and 30 A321neo narrowbodies, Reuters said, based on AAX’s 127-page explanatory documents for the creditor meetings.

“To avoid a liquidation and to allow the airline to fly again, the only option is for AAX to undertake the proposed debt restructuring,” the document said.

Bitcoin hits fresh record high

BITCOIN, the most valuable cryptocurrency, hit a record high of US$67,016 (RM278,619) on Wednesday.

Market reports suggested that the latest wave of buying has been supported by the launch of the first United States bitcoin futures-based exchange-traded fund (ETF). Cryptocurrency investors had been waiting for the approval of the ETF.

With this, investors are betting that it will open a path to greater investments from both retail and institutional investors.

Existing bitcoin ETFs and products have seen sharp inflows since September.

Average weekly flows to bitcoin funds totalled US$121.1mil (RM503.5mil) in October.

This was up from US$31.2mil (RM129.7mil) a month earlier, data from London-based CryptoCompare showed.

The three months prior to September had seen outflows following steep losses for bitcoin in May and June.

Bitcoin’s previous peak was US$64,895 (RM269,833) seen in April.

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