In a significant move, Techbase Industries Berhad (formerly known as Prolexus Berhad), together with its subsidiaries Honsin Apparel Sdn Bhd and HiQ Media (Malaysia) Sdn Bhd, has partnered with Target 1 Sdn Bhd (“T1”) to launch an Unconditional General Offer (UGO) for SMI at 45.0 cents per share, a fair value based on the current last trading price.

This strategic decision not only showcases the financial strength and strategic intent of the involved parties but also marks a critical turning point for SMI and its shareholders.

SMI Can No Longer Stay Quiet

For a while, SMI has been notably silent and reluctant to engage with its shareholders, leaving many uncertain about the company’s future. However, with the UGO now in play, SMI can no longer afford to remain unresponsive.

The offer, backed by the powerful collaboration between Techbase, its subsidiaries, and T1, forces SMI into the spotlight, compelling the company to address shareholder concerns and clarify its strategic direction.

Yet, SMI remains quiet despite major press coverage regarding the UGO. Perhaps, this is an act by the management trying to hide the fact from shareholders?

Regardless, let’s take a look if this PAC is able to takeover SMI as a whole.

Techbase and T1’s Confidence by Declaring as PAC with Financial Strength

In a bold move, Techbase, along with its subsidiaries Honsin and HiQ, has partnered with T1, a private investment holding company led by Mr. Leong Seng Wui, to act as Persons Acting in Concert (PAC) for the acquisition of SMI.

This collaboration has resulted in these entities collectively holding more than 33% of SMI’s shares, thereby triggering a mandatory general offer (MGO) to acquire the remaining shares of SMI. This declaration of concerted action, with T1 playing a key role, reflects the combined financial muscle and strategic intent to potentially acquire SMI in its entirety. T1’s involvement underscores the serious commitment to this acquisition, further strengthening the position of Techbase in leading this charge.

Unlocking Value for Minority Shareholders

For SMI’s minority shareholders, the UGO offers a significant opportunity to unlock the value of their investments. Historically, SMI’s lack of clear communication and strategic direction has left shareholders in a state of uncertainty.

However, with the backing of Techbase, T1, and the collaborative approach they have taken, there is now a clear pathway to realising the true value of SMI’s shares. The offer provides a potential exit strategy at a fair market value, driven by the committed efforts of Techbase and its partners to enhance operational efficiency and shareholder value at SMI.

Conclusion?

The collaboration between Techbase, its subsidiaries, and T1 is aimed at improving operational efficiency and enhancing shareholder value at SMI. The collaboration agreement outlines a clear framework for decision-making and control, ensuring that all material issues and business decisions at SMI are handled with unanimous consent by the involved parties.

This cohesive approach is designed to optimise management, leverage synergies, and drive growth, ultimately benefiting all stakeholders involved.

In conclusion, the Unconditional General Offer for SMI, led by Techbase in collaboration with T1, represents not just a financial acquisition but a strategic realignment that promises to deliver long-term value for all stakeholders. With the strong backing of Techbase, T1, and the clear strategic intent behind this move, SMI’s future is set to be more transparent, efficient, and ultimately, more rewarding for its shareholders.