Catalist-listed Jubilee Industries Holdings Ltd’s successful value-unlocking initiatives have been well-received by shareholders. Its latest move to dispose of its remaining 86% shareholdings in We Components Pte. Ltd. (“WEC”), the Group’s Electronics Business Unit (“EBU”) for S$21.4 million (“Proposed Disposal”) saw a significant rally in its share price, closing at S$0.073 on Monday 27th March 2023 compared to its Volume Weighted Average Price (“VWAP”) of S$0.056 as at 21 March 2023.
This follows the earlier completion of a 14% disposal in WEC to the same purchaser, Hong Kong incorporated UPC Electronics Pte. Ltd. (“UPC”), for S$2.8 million (“First Disposal”). UPC is a subsidiary of Shenzhen-listed Shanghai YCT Electronics Group Co. Ltd.
(上海雅创电子集团股份有限公司)which has over 20 years of global market experience with an extensive network throughout China and the Asia-Pacific region. Investor-One’s article in July 2022 was the first to opine that UPC saw value in the EBU and that Jubilee was worth taking a second look. [Click here to read the article]
Jubilee first acquired WEC in FY2015, enabling the Company to provide one-stop solutions for the electronics manufacturing industry. WEC acts as a distributor for its suppliers’ electronic components and products connecting them with customers in a wide range of industries in the manufacturing and services sector. The provision of focused support, extensive product knowledge, and customised services are the main drivers for the unit.
With this deal, Jubilee’s Executive Chairman and Chief Executive Officer, Dato’ Terence Tea, has pulled off a masterstroke that will see Jubilee’s Net Tangible Assets (“NTA”) increase significantly from 10.58 cents to 18.30 cents, thereby unlocking the deep value of Jubilee’s EBU that has been built up under his leadership since FY2016.
Catalist-listed Accrelist Ltd, which holds a 53.31% controlling stake in Jubilee, will also benefit from the Proposed Disposal as it continues to focus on growing its medical aesthetics business.
While Jubilee said it intends to use the proceeds to re-strategise its financial and capital resources, shareholders were more tuned in to what Dato’ Terence Tea had to say:
“To the fullest extent permissible under the laws, Jubilee intends to return the sale proceeds to shareholders in an effective and cost-efficient manner.”
-Dato’ Terence Tea
The market has since reacted positively to the news as shares of Jubilee rose as much as 27.9 percent amid heavy trading on Thursday (23 March 2023).
Earlier in February 2023, Jubilee sold its remaining shareholding interest in Bursa-listed EG Industries Berhad (“EG”) for a total consideration of approximately S$8.0 million, which Jubilee also intends to return to shareholders. The sale was done at an opportune time as EG shares had risen significantly.
Investors might want to take a closer look at Jubilee again given the latest updates.
For original article, please visit: Jubilee’s Value-Unlocking Initiatives Leads to Significant Rally in Share Price- Investor-One