Mr. Albert Ong Kim Guan, President of Magnecomp Precision Technology Public Company Limited “MPT” revealed that at the Board of Directors meeting held on December 18, the directors (excluding those who have conflict of interest in this matter) unanimously approved the agenda to delist the company’s securities from the SET. The reason was mainly due to the recent change of the company’s major shareholder, which now makes MPT a subsidiary of TDK Corporation (TDK) which is the largest independent leading head manufacturer for HDD industry. Being a subsidiary of TDK however makes the company merely a production base of HDD components for TDK, which will limit the ability of the company to generate the highest profits, despite the positive effect to MPT by having the orders from the parent company itself. In addition, TDK intended to use its own financial sources and banking support to finance MPT’s working capital and any future expansion, thus, it is not necessary for MPT to raise fund via stock market. Furthermore, due to previous shares acquisition and the ongoing tender offer of MPT’s shares conducted by TDK, currently, TDK holds more than 85% stake of MPT. Thus, the company would be no longer qualify for maintaining its listing status according to the SET’s regulation regarding the minimum free float level, which requires the listed company to maintain at least 15% free float. In addition, MPT does not have any plan to increase this free float level as required.
In January 22, 2008, the company will convene the Extraordinary Shareholders Meeting to approve the delisting. In the event the company obtains the approval from the shareholders and the SET, TDK will perform the next tender offer around March 2008 in order to comply with the SET’s delisting rules. After the delisting of the company’s securities, those shareholders who decline to accept the tender offer will be impacted by the lack of liquidity in trading of company’s shares as there will not be a secondary market to support them. Moreover, capital gains will no longer be tax exempted for the shareholders and their access to information about the company will be limited.
In addition, the tender offer condition for the delisting must comply with the SEC’s Notification No. Kor Jor 53/2545 regarding rules, conditions and procedure of holding securities for business takeover, which states that the tender offeror will be unable to acquire or undertake any action to get additional shares at a better price than the price of this tender offer. Therefore, the tender offer price for the de-listing will not be higher than the existing offer price, which is Bt. 2.70 per share.
Those shareholders who wish to sell MPT shares are able to contact and submit the tender form at Trinity Securities Plc, 25th floor, Bangkok City Tower, 179/109-110, South Sathorn, Bangkok till the last day of the tender offer, which is December 25, 2007, during 9.00hrs till 16.00hrs (working days). For any additional information, please call 0-2343-9500 ext 603. Tender offer of MPT undertaken by TDK (Form 247-4) can be viewed at www.MagnecompPrecision.com. Additionally, opinions of the tender offer by the company and the Independent Financial Advisor (Form 250-2), which can be used as information to accept or decline the tender offer, can be viewed at the SET’s website, www.set.or.th.
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Magnecomp Precision Technology
162 Moo.5 Phaholyothin Road, Ayutthaya 13170 Thailand
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Fax: 966) 3521-5345