Spice i2i Buys Thai Handset Firm For US$22m
Spice i2i acquired Thailand’s NewTel Corporation (NewTel), a distributor of mobile phones under the Wellcom brand, for US$22m. The purchase consideration is made up of an upfront cash payment to the vendor of US$10m, with the remaining US$12m payout over the next 3 years if it meets a set of performance benchmarks. NewTel posted sales of US$56m last year and commands a local handset market share of nearly 8%, behind frontrunners Nokia and Samsung.
According to Spice i2i’s CEO Maneesh Tripathi, the Wellcom handset brand will eventually be folded within Spice i2i’s new company-wide ‘S’ branding although it will still be used in the interim. Meanwhile, Spice i2i has just opened its first handset retail store in Myanmar and more could follow in neighbouring countries within the next 12 months. The firm has set a goal of establishing a direct presence in the 10 countries that fall within the so-called i2i (Ivory Coast to Indonesia) region by 2011.
Significance: In line with its goal, the purchase will present Spice i2i the opportunity, using the Wellcom brand, to grow its footprint in the Greater Mekong sub-region where the penetration rate is low and the market is sizeable due to the absence of a runaway market leader.
China Animal Healthcare Reveals Bid For Larger Market Share
China Animal Healthcare (CAH) is eyeing a larger market share in the sale of animal drugs in China. In order to achieve this, the company is seeking to expand the range of products sold to retailers and acquire companies that will give it access to the manufacture and sale of bird flu drugs – the missing piece among four mandatory animal vaccines for CAH. CAH is also looking to expand its pool of sales personnel from 2,000 to 3,000 in the next 2-3 years and spend about Rmb3-5m in research and development over the same period. Meanwhile, CAH’s Hong Kong dual primary listing by way of introduction is underway. However, the company does not rule out issuing new shares in the future if its expansion plan proceeds more expeditiously than expected.
Significance: CAH’s expansion plan should underpin its earnings growth in the long run. Moreover, with Hong Kong perceived to be a more stringent stock exchange, emerging from another round of scrutiny may win over investors who continue to second-guess CAH given the perception problem plaguing S-chips.
DBS Sells Asset Management Arm To Nikko In $137m Deal
DBS Bank sold its asset management arm to Nikko Asset Management Co (Nikko AM) in a deal valued at $137m. Under the terms of the agreement, Nikko AM will acquire DBS Asset Management and DBS will have a 7.25% stake in the enlarged Japanese company. DBS will also inject into Nikko AM its 30% stake in HwangDBS Investment Management; its 51% stake in Asian Islamic Investment Management; and its Hong Kong fund management subsidiary. The combined assets under management of these entities as at Sep-10 was US$7b. As part of the transaction, DBS and Nikko AM will also enter into a non-exclusive distribution agreement through which Nikko AM’s portfolio of investment products can be distributed through DBS’ network in the region. According to the chairman and CEO of Nikko AM, the Singapore operations are expected to be managing about US$17b in a few years’ time, with assets under management amounting to US$200b in 5-7 years’ time.
Significance: The move is deemed strategic, allowing DBS to focus on banking operations in core Singapore aand Hong Kong markets while letting more established Nikko AM drive asset management business. For the latest updates PRESS CTR + D or visit Stock Market news Today
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