Datapulse to sell Tai Seng premises for S$53.5m

LOSS-MAKING digital storage products company Datapulse Technology on Monday said it is looking to dispose of its Tai Seng premise, Datapulse Industrial Building, for S$53.5 million.

The company had on July 26 granted an option to purchase to an unnamed independent third party purchaser for the sale of its property at 15A Tai Seng Drive. The option will remain valid up to 4pm on Aug 9.

The property is a leasehold property granted by state industrial landlord JTC, with a 30-year tenure starting from August 1993, with a further term of 30 years. The six-storey industrial building comprises production and warehouse areas as well as ancillary offices, and has a gross floor area of about 15,174 sq m.

The disposal is conditional on shareholders’ and JTC’s approval, among other things.The property is used solely for the group’s manufacturing activities.

Datapulse said: “The board believes that the proposed disposal is in the best interests of the company and its shareholders, as it will enable the group to realise the value of the property at a significant premium over its book value, and allow the group to reallocate its resources to improve and optimise the utilisation of assets.”

The net asset value of the property is about S$8.4 million as at end-April 2017.

The net gain on the proposed disposal is expected to be about S$44.5 million. The company plans to deploy part of the proceeds to acquire a new facility to continue its existing business and operations.

The remaining proceeds will be used as general working capital for the group’s businesses and operations and for the group to undertake new investment opportunities that may arise in the future, it said.

A valuation report from April 2016 by Cushman & Wakefield valued the property at S$57 million for a balance lease period of 37 years and four months. The property now has a balance lease period of 36 years and one month left.

Datapulse reported a net loss of S$1.2 million and a 34 per cent drop in revenue to S$2.3 million for its third quarter ended April 30, due to weaker demand for its media storage products and services, it said.

Its shares last closed at $0.26 last Wednesday. The counter resumes trading on Tuesday, following the lifting of its trading halt.