Latest news with #SpiritMY
The Star
12-08-2025
- Automotive
- The Star
DRB-Hicom shares rise after Spirit Aerosystems Malaysia acquisition plan
KUALA LUMPUR: DRB-Hicom Bhd 's shares edged higher following its proposal to acquire the entire equity interest in Spirit Aerosystems Malaysia Sdn Bhd (Spirit MY). The conglomerate rose 1.84%, or 1.5 sen, to 83 sen at 10.21 am, though it remains down about 25% year-to-date. On Monday, DRB-Hicom said its wholly owned subsidiary, Composites Technology Research Malaysia Sdn Bhd (CTRM), had entered into a conditional share purchase agreement to acquire Spirit MY for a sum to be determined based on an enterprise value of US$95.2mil. Hong Leong Investment Bank Research (HLIB Research) is positive on the acquisition, noting that Spirit MY's stable earnings are expected to complement CTRM's operations and enhance DRB-Hicom's overall financial performance. 'The indicative price-to-earnings (P/E) valuation stands at 7.0x, aligning closely with DRB's projected P/E of 7.4x for FY26 and 5.4x for FY27. 'The deal is expected to yield a negative goodwill gain of RM223.2mil, while CTRM will eliminate RM12.7mil in profits related to unsold inventory,' HLIB Research said. 'We anticipate an additional earnings contribution of around RM45mil per year - equivalent to approximately 21.5% of FY25 earnings and 15.4% of FY26 earnings,' it added. While HLIB Research maintains a positive view on the acquisition, it is keeping its 'hold' recommendation with an unchanged target price of RM0.85, based on a 25% discount to its sum-of-the-parts valuation of RM1.11. 'We remain cautious on DRB's main business segment - automotive, given stiff market competition, while PosM and Deftech remain as drags to the group, partially offset by the steady contributors like Bank Muamalat and CTRM,' it said. Kenanga Research described the acquisition as 'mildly positive,' noting that it should be price-to-earnings (P/E) accretive, with Spirit MY valued at 14 times compared with DRB-Hicom's 16 times. The research house cautioned that there is currently a greater risk as Spirit MY no longer operates under the Spirit Group and, therefore, lacks cost-plus protection. 'We keep our earnings forecasts, target price of RM0.68 and underperform call, pending shareholders and regulators' approval,' it added.
Malaysian Reserve
11-08-2025
- Automotive
- Malaysian Reserve
DRB-Hicom to acquire Spirit AeroSystems Malaysia for US$95.2m
DRB-HICOM Bhd's wholly-owned subsidiary, Composites Technology Research Malaysia Sdn Bhd (CTRM), has entered into a conditional share purchase agreement with Spirit AeroSystems Inc and Spirit AeroSystems International Holdings Inc for the acquisition of Spirit AeroSystems Malaysia Sdn Bhd (Spirit MY) for a purchase consideration to be derived based on an enterprise value of US$95.2 million. The transaction is subject to all relevant approvals and conditions being fulfilled. CTRM, recognised as a leading supplier of advanced aerospace composites, specialises in the development and production of composites sub-assemblies for the global aerospace industry. Its core expertise includes producing aircraft composite components, designing and manufacturing composites for aerospace and non-aerospace applications, as well as offering support services such as testing laboratory facilities, composites engineering, and supplier management. Spirit MY, based in Subang, Selangor, is a supplier to global original equipment manufacturers (OEMs) within the aerospace industry. It produces advanced technology aerostructures and provides ancillary services to its related companies. Its products include key components and assemblies for Airbus and Boeing programmes such as the A220, A320/A321, A350, B737 and B787. The company also offers engineering services, supply chain management and shared services. According to CTRM, the proposed acquisition 'represents a strategic opportunity to further enhance CTRM's competitive position in the aerospace industry by enhancing its aerostructures expertise. This would contribute towards improved scale, efficiency, and growth in various areas that would elevate CTRM's presence in key aerospace programmes and deepen its relationships with global OEMs, expanding CTRM's relationships with Airbus for their A220, A320, and A350 programmes, and to Boeing on the 737 and 787 programmes.' The group added that the move would strengthen its presence across the supply chain, positioning it for long-term competitiveness and sustainable growth 'in an increasingly challenging and dynamic aerospace market'. CTRM also noted that the acquisition is aligned with national objectives to strengthen Malaysia's position as a regional aerospace hub under the New Industrial Master Plan 2030 and the Malaysian Aerospace Blueprint 2030, while promoting Malaysian ownership of strategic assets. AmInvestment Bank has been appointed as the principal adviser to DRB-Hicom for the proposed acquisition. — TMR
The Star
11-08-2025
- Business
- The Star
DRB-Hicom to buy Spirit Aerosystems Malaysia in deal valued at US$95.2mil
KUALA LUMPUR: DRB-Hicom Bhd has proposed to acquire the entire equity interest in Spirit Aerosystems Malaysia Sdn Bhd (Spirit MY) for a purchase consideration to be determined based on an enterprise value of US$95.2mil. In a filing with Bursa Malaysia, the conglomerate said its wholly owned subsidiary, Composites Technology Research Malaysia Sdn Bhd (CTRM), had entered into a conditional share purchase agreement with Spirit AeroSystems Inc and Spirit AeroSystems International Holdings Inc for the proposed acquisition. Upon completion of the proposed acquisition, Spirit MY will become a wholly-owned direct subsidiary of CTRM. CTRM and its subsidiaries develop and produce aircraft composite components, design and manufacture composite parts for aerospace and non-aerospace applications, and provide testing, engineering and supplier management services. Spirit MY is a key customer of CTRM, contributing 54.1% of CTRM's consolidated revenue for the financial year ended Dec 31, 2024 (FY24). Spirit MY produces advanced technology aerostructures and provides ancillary services to related companies, supplying key components for Airbus and Boeing programmes, including the A220, A320/A321, A350, B737 and B787. Based on the latest audited consolidated financial statements of Spirit MY for FY24, Spirit MY registered a profit after tax of RM70.1mil and net assets of RM770.5mil. DRB-Hicom said the purchase consideration will be fully satisfied in cash, which is expected to be funded through bank borrowings. The group said the proposed acquisition represented a strategic opportunity to further enhance CTRM's competitive position in the aerospace industry by enhancing its aerostructures expertise. 'This would contribute towards improved scale, efficiency, and growth in various areas that would elevate CTRM's presence in key aerospace programmes and deepen its relationships with global OEMs, expanding CTRM's relationships with Airbus for their A220, A320, and A350 programmes, and to Boeing on the 737 and 787 programmes. 'At the same time, CTRM will enhance its presence across the supply chain and be better positioned for long-term competitiveness and sustainable growth in an increasingly challenging and dynamic aerospace market,' it said. 'In addition, this acquisition is in line with and supports ongoing efforts to strengthen Malaysia's position as a regional aerospace hub under the New Industrial Master Plan 2030 and the Malaysian Aerospace Blueprint 2030, as well as strategies to promote Malaysian ownership of strategic assets,' DRB-Hicom said.
