CCT Telecom Holdings has returned with a privatisation plan for its undervalued telecommunications products manufacturing and sales arm CCT Tech International for the second time in less than a year.
The company is planning to privatise CCT Tech by way of a scheme of arrangement constituting a major transaction for CCT Telecom, according to an announcement from the company yesterday.
The share price for CCT Tech was 2.2 cents yesterday, compared with the privatisation price of 2.3 cents proposed in January.
The parent company, CCT Telecom, was priced at 9.4 cents. Both stocks were suspended yesterday pending the publication of a more detailed announcement.
The privatisation of CCT Tech was derailed by minority shareholders in January with the consequence that CCT Telecom could raise its shareholding from 34.51 per cent to only 84.12 per cent upon completion of the offers.
To restore the public float, CCT Telecom sold 1.5 billion existing shares on July 22 to a third party with a six-month put option granted to the buyer.
CCT Tech is a potential gold mine with a net cash level of $450 million on June 30, with additional accounts receivables of up to $688.3 million from just two big customers. However, the market capitalisation of the stock has been undervalued at $350.65 million at 2.2 cents per share.