- POSTED: 26 Aug 2014 14:53
The sale is part of United Engineers', which owns WBL Corporation, plans to exit from non-core operations.
SINGAPORE: Singapore-listed United Engineers announced on Tuesday (Aug 26) that its subsidiary, WBL Corporation, is selling its luxury car business to StarChase Motorsports (Singapore) for S$455 million.
In a filing to the Singapore Exchange (SGX) on Tuesday, the company said that the proposed disposal is part of its plan to exit from non-core operations and unlock value for its shareholders. United Engineers holds a 67.6 per cent stake in WBL, also known as Wearnes.
Wearnes' automotive business recorded an operating profit of S$6.23 million in the first half of 2014 on the back of S$446.84 million in revenues. It imports and distributes luxury cars such as Bentley, Jaguar, Infiniti and McLaren, among others.
United Engineers said it expects to receive net proceeds of about S$292.1 million from the sale and book a net disposable gain of about $17.1 million. The net proceeds will be used to repay their external debt and for general working capital.
Last week, United Engineers was linked to talks between OCBC Bank and Thai billionaire Charoen Sirivadhanabhakdi on a possible stake sale. The bank and its insurance unit, Great Eastern Holdings, are in talks on the possible sale of its combined stake in United Engineers and WBL Corporation.
OCBC and its related firms hold a 36 per cent stake in United Engineers, which has a market value of US$1.2 billion (S$1.5 billion).
Last Thursday, United Engineers shares jumped 7.4 per cent before trading was halted at the request of the company. The stock gained a further 12.2 per cent the next day, and trading was halted again this Monday pending the announcement.