SPTel mainly engages in network broadband business of enterprise, formerly known as SP Telecommunication, a subsidiary of New Energy Group. In May 2017, Xinke Engineering City Solutions Company bought 51% of SPTel's equity, and New Energy Group continued to hold 49% of the equity.
On June 25 this year, Xinke Engineering announced that it would sell LeeBoy, the manufacturer of its indirect wholly owned subsidiary, its main tar paving equipment, to the French FAYAT Group, for a price of US$290 million (about S$372 million). The transaction is also expected to be completed in the fourth quarter of this year, with net proceeds of approximately $246 million from the sale, which will be used to repay Xinke Engineering's debt.
Xinke Engineering issued a statement on Thursday (July 17) saying that its subsidiary Urban Solutions has reached an agreement with New Energy Group to sell SPTel, a joint venture network company, to Seraya AQX, with a transaction price of RMB 290 million, but the final transaction price is to be adjusted when the transaction is completed.
In addition, if Seraya AQX company reaches a specific return on investment threshold in the future, the seller can receive an Earn-Out Amount (Earn-Out Amount).
Xinke Engineering's stock price closed at 8.38 yuan on Thursday, starting 0.48%.
According to the statement, SPTel's annual revenue in 2024 was 72 million yuan and a net loss of 4 million yuan; since it was recorded on the equity method, the company's performance was not included in the financial statements of Xinke Engineering or New Energy Group.
This transaction is expected to be completed in the fourth quarter of 2025, but it must meet conditions such as obtaining approval from the Information and Communications Media Development Bureau.
Xinke Engineering said in a statement at the time that this sale is a step for the group to continuously optimize its investment portfolio, aiming to concentrate resources on core business areas such as aviation, defense and smart cities in the future.
Xinke Engineering said that the transaction is expected to bring about an over-profit of about 80 million yuan and does not constitute a major transaction. It also said that after the transaction is completed, it is believed that SPTel can continue to develop under the leadership of new shareholders. With the help of the latter's strategic fit, it may help SPTel expand its scale and provide more diversified network services.
It is reported that Seraya AQX is a subsidiary of Seraya Partners, an independent private equity fund headquartered in Singapore that focuses on investing in "next generation infrastructure" projects.
ST Engineering continues to dispose of some of its investment companies and announces plans to sell SPTel, a joint venture with Singapore Energy Group. If the transaction is completed, it is expected to obtain a one-time profit of 80 million yuan.