UniVision Engineering (LON: UVEL) was the biggest mover in London on Wednesday after the company revealed its Chairman, Stephen Koo, agreed to sell a 52% stake in the business.
SinoCloud, an investment holding company, has agreed to pay Koo 4.1p per ordinary share or £8.2 million in total. Koo will retain a 20.5% stake in the company.
The transaction is subject to several pre-conditions, including satisfactory due diligence on UniVision by SinoCloud, an equity fundraising by SinoCloud and approval by SinoCloud's shareholders.
If the transaction is complete, SinoCloud has agreed to make a minimum funding facility of HK$10.0 million available to UniVision within three months of completion of the agreement.
The transaction is not expected to be finalised until sometime in April 2021.
UniVision did clarify that the UK Takeover Code does not apply and, should the transaction complete, SinoCloud will own 52.4% of the issued share capital, but they have indicated they have no current intention to make a general offer for the rest of the company.
The company’s shares soared following the news, ending the day up 145.45% at 2.70p per share.
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Sam is a professional trader and the lead stock market news writer at AskTraders. After starting his career in the forex market, Sam now focuses on gold and stocks with a preference for fundamental and macroeconomic analysis.