Procurri loses another potential buyer as US investor drops out

An investment firm has withdrawn its acquisition offer for technology supplier Procurri Corporation, it was announced yesterday.

No specific reasons were provided for the withdrawal by New State Capital Partners from the deal, which was first announced on Feb 3.

New State is a private American firm that invests in business, healthcare and industrial services.

It had earlier proposed to acquire all the shares of Procurri, other than treasury shares and those held by substantial investor Irrucorp, via a scheme of arrangement.

Irrucorp owned 12.03 per cent of Procurri as at March 16, 2018, according to Procurri's 2017 annual report.

Procurri chairman and chief executive Sean Murphy, and executive director and global president Edward Flachbarth are both deemed to have interests in Irrucorp.

New State's withdrawal follows the termination of further discussions with another interested but unnamed buyer.

The move comes after Procurri's major shareholder, DeClout, said last month that it would further pare its stake in the mainboard-listed firm.

 

DeClout intends to sell 36.3 million Procurri shares to a fund held by a private equity firm at 33 cents apiece to raise net proceeds of $12 million.

Procurri, whose operations include supplying data centre equipment, said yesterday that the deal between DeClout and the private equity firm would be done via a put and call option agreement. The options are due to be exercised between March 18 and April 17.

DeClout now owns less than 30 per cent of Procurri, having cut its stake from 46.8 per cent when it sold 48 million shares - or 17.2 per cent - in January at 32 cents each.

Two independent third parties bought the shares.

The first buyer, a Soh Chooi Lai, acquired $11.8 million worth of stock on Jan 4, amounting to 13.5 per cent of Procurri.

The other buyer is unnamed. Only investors holding more than 5 per cent of a firm must declare their stake in a regulatory filing.

Procurri shares slumped after the news yesterday, and closed down 9.7 per cent at 28 cents.

A version of this article appeared in the print edition of The Straits Times on February 20, 2019, with the headline 'Procurri loses another potential buyer as US investor drops out'. Print Edition | Subscribe