Singapore-based Yoma Strategic Holdings Ltd said it is to expand its automotive division with the proposed acquisition of the established New Holland tractors and farm equipment business.
The group had previously announced that it was reviewing the portfolio of automotive businesses within the Myanmar-based Serge Pun & Associates (SPA) Group.
Later Yoma decided to acquire 100 percent interest in Convenience Prosperity Co Ltd (CPCL), which is an authorised dealer of New Holland tractors and farm equipment in Myanmar, from SPA Group.
CPCL has branches and dealerships in 10 cities across the country and offers the distribution and servicing of imported New Holland farm equipment to local farming communities, developing a broad customer base consisting of government ministries, agribusinesses, village collectives and individual farmers.
For the financial year ended March 31, CPCL posted a net income of S$0.4 million and maintained a stock of 176 tractors and 306 units of implements for tractors.
Yoma said the company believes that CPCL will offer “significant synergies” to a number of its existing businesses, including the agriculture division and the leasing business, Yoma Fleet.
Based on independent valuation by Jones Lang LaSalle, the consideration payable for 100 percent interest in CPCL is S$2.8 million. In addition, Yoma will also be assigned and pay for a shareholders’ loan amounting to S$12.0 million which was advanced by the shareholders to CPCL to acquire tractors and implements for tractors, making the collective acquisition price for CPCL about S$14.8 million.