SINGAPORE Temasek Holdings, the Singapore government's investment arm, appears set to expand its footprint in the regional electronics industry. Temasek has teamed with a group that unveil a planned takeover of Malaysian automation equipment manufacturer LKT Industrial.
LKT said in a filing with the Malaysian stock exchange that Singapore Precision Engineering had agreed to acquire 45 percent of LKT's shares for around $27 million in cash. Singapore Precision Engineering is a wholly-owned subsidiary of Singapore Aerospace Manufacturing, which is in turn owned by Accuron Technologies, a unit of Temasek.
When the sale is finalized, Singapore Aerospace Manufacturing will be required under Malaysian law to make an offer for the remaining LKT shares it does not own.
LKT denied local media reports this week that its buyer was set to bankroll a massive expansion of its manufacturing operations, saying only it would "make [an] appropriate announcement should their be any plan on this in due course." The Penang-based firm currently owns two plants with a total of over 220,000 square feet of floor space.
The LKT takeover is Temasek's latest move in the electronics sector. In May, it failed in a bid to take private Singapore-based packaging house STATS ChipPAC, but did manage to raise its stake in the firm to over 80 percent.