SINGAPORE - Satellite communications equipment provider Global Invacom Group (GInva) has agreed to acquire the entire issued and paid-up share capital of Tactilis, a Malaysian firm which makes proprietary biometric system-on-card solutions.
Tactilis has been valued at U$200 million (S$275.7 million) on a "willing-buyer and willing-seller basis".
Its main product offering is a biometric central card management system known as the Tactilis Touch, which is capable of multi-factor identity authentication using fingerprints, face recognition and iris recognition, GInva said on Wednesday morning.
GInva will make an initial investment of U$2 million for 2 per cent of its share capital by subscribing for convertible notes. These notes have a coupon rate of 5 per cent and GInva has the option to subscribe for additional notes with an aggregate principal amount of up to U$8 million.
Depending on whether GInva exercises the option, the consideration for the rest of Tactilis' shares will range from U$190 million to U$198 million, to be satisfied by the issue of new shares in GInva at $0.15 per share.
GInva said: "The prominent features of the Tactilis Touch include a sensor capable of capturing 20-40 minutia of fingerprints, which is more than the five-eight minutia captured by standard fingerprint sensors. It has the ability to drive multiple applications and contains large memory space of up to four gigabytes. The Tactilis Touch is produced by a unique proprietary molding process which enables cost efficient manufacturing of the smart cards."
The Tactilis Touch communicates with devices and servers by Bluetooth, WiFi, near-field communication (NFC) or global positioning system (GPS) and supports remote updates.
GInva will buy Tactilis from Tactilis Pte Ltd, whose largest shareholder is Trufinger Management Ltd with a 29 per cent stake in the vendor. Michael Gardiner, the founder and chief executive officer of Tactilis, is a shareholder of Trufinger.
The deal is subject to due diligence and the approval of GInva's shareholders which will be sought at an extraordinary general meeting, since the acquisition will result in a very substantial acquisition or a reverse takeover.
GInva expects to make the necessary submissions relating to the proposed acquisition in April 2019, pending finalisation of the audited financial statements of the group and of Tactilis for the year ending Dec 31, 2018. GInva expects that the proposed acquisition may be completed in the third quarter of 2019.
GInva will also issue up to $20 million of unsecured redeemable structured convertible notes to Advance Opportunities Fund, Advance Opportunities Fund I, Advance Credit Fund SPC and Advance Capital Partners Asset Management to raise money for the acquisition. These notes have a coupon of 1 per cent.
Mainboard-listed GInva was placed on the Singapore Exchange watch list in June after recording a volume-weighted average price of less than $0.20 and an average daily market capitalisation of less than $40 million over the then last six months.
The board hopes the proposed acquisition will give the company a new lease of life and support its application to be removed from the watch list.
The announcement was made before market open on Wednesday. GInva's shares opened at $0.075 on Wednesday, up 15.38 per cent from their last traded price of $0.065 on Oct 15. Trading had been halted since last Thursday, pending the announcement.
Correction note: An earlier version of this article wrongly stated that GInva will buy Tactilis from its 53 shareholders.