UE E&C

UE E&C: Grp has entered into a sale and purchase agreement with shareholders of APG Geo-Systems Sdn Bhd (APG) to acquire a 90% stake for RM12.3m ($4.9m) in cash. The selling shareholders are: UED Developments Sdn Bhd (an indirectly wholly owned subsidiary of United Engineers Limited) - 60%, and (iii) three unrelated third party individuals – 30%. APG is a geo-technical foundation engineering company in Msia with more than 20 yrs of experience. APG recorded net profit of $292k for FY11 and its net asset value is expected to be not less than RM15m (S$6m). As house expecting UE E&C to announce its 3Q12 results in the coming weeks, keep our BUY rating and $0.71 fair value unchanged.