KUALA LUMPUR: Cybersecurity and e-business solutions company Systech Bhd plans to propel the company forward with plans to acquire Wilstech Sdn Bhd for RM75 million.
It also plans to raise RM51.84 million cash by issuing new shares in the company and undertake a bonus issue of up to 160,656,399 new warrants based on one warrant for every four existing Systech shares held on a date determined later by the board to reward existing shareholders.
Systech has entered into a conditional share sale agreement with Low Min Yew, Sea Capital LP and Maybank Trustees Bhd to acquire the entire 552,255 ordinary shares in Wilstech Sdn. Bhd through a combination of RM20 million cash and 152.78 million shares.
The acquisition of business-to-business information technology solutions company, Wilstech, comes with a profit guarantee of not less than RM5.0 million for the next financial year, from April 1, 2024, to Mar31, 2025.
To mitigate Systech's risks, the company will retain RM30.0 million as security for the performance of the profit guarantee.
Wilstech is a Malaysia Digital Status company and an authorised digitalisation partner under the Geran Digital PMKS Madani initiative — a government initiative to assist micro, small, and medium enterprises in improving digitalisation applications in their daily businesses.
Furthermore, Low Min Yew will continue to lead and expand the company's operations when the proposed acquisition is completed.
The acquisition is subject to the approval of Wilstech shareholders and Bursa Securities, and expected to be completed in the first quarter of 2024.
Malacca Securities has been appointed as the principal adviser for the proposals.