Advanced Holdings says its wholly-owned subsidiary, Advanced Engineering Holdings, has entered into a sale and purchase agreement (SPA) and supplemental agreement with Advanced CAE for the disposal of Advanced CAE Saudi Arabia Company (CAEKSA), a wholly-owned subsidiary of the group.
On Sept 17, the group announced that the purchase consideration of CAEKSA stood at $1, due to the net liability value of the CAEKSA disposal shares and the losses incurred by CAEKSA. CAEKSA reported net tangible liabilities and a loss before tax of $152,522 and $149,213 respectively for the financial period ended June 30.
According to the group, the disposal is “aligned with the group’s plan to exit from the business of engineering services to focus on its agri-technology operations”.
The group adds that following CAEKSA’s continued losses, which require the continued additional financial support from the group to maintain operations, it is not “commercially meaningful to continue managing the business”.
Additionally, CAEKSA has several outstanding projects, which require working capital funding of approximately $3 million, reads the release.
Upon completion of the disposal, the group says that it is expected to redirect its managerial efforts into agri-technology operations.
See also: Interra Resources granted 12-month extension to meet SGX watch-list exit requirements
The disposal is expected to be completed by Oct 31.
Shares in Advanced Holdings BLZ closed 1.6 cents lower, or down 13.2%, at 10.5 cents on Oct 21.
