Citaglobal Bhd has announced that it is acquiring a 60% stake in registered solar photovoltaic provider Spectra Suria Sdn Bhd for RM2 million in cash, and a 40% stake in registered solar photovoltaic investor company Nova Reeco Sdn Bhd for RM3 million in cash.
Spectra Suria and Nova Reeco has secured projects from a variety of government departments and quasi-government agencies. Both acquisitions come with an orderbook of RM268 million, boosting Citaglobal’s total orderbook will be boosted to RM1.27 billion and above.
Along with the acquisition of a 40% stake in Nova Reeco, Citaglobal also intends to purchase irredeemable convertible preference shares (ICPS) in the company. These shares are convertible into an additional 20% equity interest in Nova Reeco. In addition, Citaglobal has committed to making further investments, either in the form of a shareholder’s advance or redeemable preference shares with a value of at least RM7 million, in its Nova Reeco venture. This would bring its total investment in both acquisitions to a total of RM12 million.
These acquisitions are conditional on a few terms. Key among them, Spectra Suria is to be issued a letter of award from Nova Spectra Energy for its appointment as the engineering, procurement, construction and commissioning (EPCC) contractor for the Lembaga Kemajuan Ikan Malaysia (LKIM) project.
Spectra Suria is principally involved in EPCC works of solar photovoltaic (PV) and energy storage systems. Nova Reeco is principally involved in the business of organization, promotions and management of events, specialized design activities, and the wholesale of a variety of goods.
The Proposed Acquisition of Spectra Suria is expected to be completed within 30 days, while the Proposed Acquisition of Nova Reeco is expected to be completed within 2 months. Upon completion, both acquisitions are expected to contribute positively to the future earnings of the Group, as and when Spectra Suria and Nova Reeco begin recognising profits from their projects
