Singapore’s Big Winner for the Week: Trek 2000 International Ltd

Trek 2000 International Ltd (SGX: 5AB), which put Singapore on the world map by creating the ThumbDrive, has gained 2.3% since last Friday to close at S$0.44 yesterday.

Its performance trumps the 0.6% return delivered by Singapore’s market barometer, the Straits Times Index (SGX: ^STI), making the company a big winner in the local share market this week.

On 24 June, the firm announced that massage chair maker OSIM International Ltd (SGX: O23) will be buying 24 million of its new shares and 1 million of its treasury shares for S$0.4365 each.

OSIM will be spending a total of S$10.9 million and the company said that it should be using the cash resources it has to fund the investment. Following the purchase, OSIM will own an 8.75% stake in Trek 2000, up from 1.14% previously.

The massage chair maker added that it is keen to work with Trek 2000 “on the commercial application of its patents and technology for products in the wellness and healthy lifestyle sectors.”

Beyond OSIM’s investment, Trek 2000 will also be undergoing a private placement of 2 million new shares of itself at S$0.4365 apiece. Together with the new shares that are issued to OSIM, Trek 2000 will be issuing new shares that collectively represent 8.8% of its existing issued share capital (excluding treasury shares).

The total net proceeds of approximately S$11.6 million will be used by Trek 2000 for its “ongoing strategic research and development, particularly in the areas of medical diagnostic technology” and to “fund the ongoing growth and expansion of the Group’s business and operations.”

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Sudhan P doesn’t own shares in any companies mentioned.