ENGINEERING solutions provider Destini Bhd plans to acquire Australia-based Trovon Group Pty Ltd (TGPL) for A$100 in a deal that will give it exposure to the rail maintenance sector.
In an exchange filing today, the Shah Alam-based company said the deal will give its wholly-owned subsidiary TF Corp Pte Ltd full ownership of TGPL which provides rail maintenance, repair, and overhaul (MRO) services in Australia, New Zealand and Malaysia.
It said Destini was committed to settle the remaining debt of A$3.25 million under the loan agreements within 120 days after the completion of the proposed acquisition.
The filing said that TGPL has an order book of A$43.35 million and recorded a loss of A$4.81 million for the year ending June 30, 2023.
TF Corp has entered into a conditional share sale deed a bumber of parties that control TGPL, led by Alceon Group Pty Ltd as trustee for the Trovon Convertible Note Trust which has a 73.77% stake and Alceon Group Pty Ltd as trustee for the Trovon Investor Trust (21.55%).
The New South Wales-based TGPL’s principal activities are mainline, high speed, freight, metro and light rail component remediation services.
It said TGPL’s principal activities involving the MRO focuses on high performance, re-engineering processes that extend service intervals, prolonged asset life, supply chain efficiency, superior fleet availability and safety. It has secured several contracts which will increase its earnings visibility over the next five years.
It added that the company’s expertise spanned critical areas including brake systems, HVAC, and train doors, complemented by its cutting-edge AI-driven predictive maintenance platform, SYVX, developed in partnership with global AI leader SparkCognition.
“Trovon’s established track record in Australia and New Zealand, combined with their OEM certifications and advanced AI-powered maintenance solutions, perfectly aligns with our strategic vision for growth in the rail sector,” Destini ED Ismail Mustaffa said in a statement.
While Trovon reported a loss in FY2023, Destini said the strategic value of its certifications, technical capabilities, and global presence presented ‘significant opportunities’ for value creation under Destini’s ownership.
Destini share price was flat at 32.5 sen, valuing the group at RM162 million. – TMR
