SiS garners $545m from 80pc stake sale to US-based CHS Electronics

SiS International Holdings has sold 80 per cent of its computer distribution subsidiary in Asia to a United States computer distributor for HK$545.6 million.

CHS Electronics will buy 80 per cent of SiS Distribution, the primary subsidiary of Hong Kong-listed SiS International. CHS will pay a premium of 486 per cent over the company's net assets of HK$116.4 million at the end of fiscal year 1996, according to Lim Kia-hong, SiS International's chief executive.

SiS International stock was trading at 39 cents when the market closed in Hong Kong on Friday. The price paid by CHS, a mix of cash and stocks, is about 25.6 times SiS earnings last year.

Chief executive Lim Kia-hong said: 'The key thing is we are a partnership for future growth.' SiS will benefit from cash that it will use to invest in new technology firms in Asia.

The Asian computer distributor will also benefit from CHS' access to computer products from the US and from cheaper prices afforded by the resulting economies of scale.

Founded in 1983 by Mr Lim and his brother, both Singaporeans, SiS started off as a one-room office-cum-warehouse in Causeway Bay.

Since then, SiS has grown into a wholesaler of brand-name computer products like Compaq, IBM, Cisco and HP.