Airport services group SATS has entered into a conditional share sale agreement with Malaysia Airlines in acquiring a 10 percent stake in their in-flight meals caterer Evergreen Sky Catering Corporation (ESCC).
As per details of the agreement, SATS will be acquiring 11 million ordinary shares in the capital of Evergreen Sky Catering for RM100 million (about US$22.3 million), adding to its originally owned 16.5 million ordinary shares which represent 15 percent in ESCC.
Following the acquisition, the Singapore-listed SATS would now own 27.5 million ordinary shares in the capital of ESCC, which represents 25 percent of the total issued ordinary shares in the capital of ESCC.
With this, ESCC would also become an associated company of SATS, the provider of gateway and food solutions announced during its filing at the Singapore stock exchange on Tuesday.
Commenting on the deal, SATS said, “The proposed acquisition is in line with the company’s strategy of growing the scale of its food business and enhancing its connectivity to better serve its customers across key airports in Asia.”
The acquisition is not expected to have any material impact on the company’s net tangible assets per share and consolidated earning per share for the current financial year.
Shares of SATS closed at S$0.02 cents higher at S$4.85 on Tuesday.
By Vivian Foo, Unicorn Media