Summary for Prospectus Dated 11 June 2003
The following summary is qualified in its entirety by, and is subject to, the more detailed information and financial statements (including the notes thereto) appearing elsewhere in this Prospectus. Terms defined elsewhere in this Prospectus have the same meaning when used herein. Prospective investors should carefully consider all the information presented in this Prospectus, particularly the matters set out under "Risk Factors" before making an investment decision.
Our Group and Our Activities
Allied Singapore was incorporated in Singapore on 31 August 1990 as a private company limited by shares. It changed its name to Allied Technologies Limited on 12 May 2003 in line with the change of its status to a public limited company. Allied Singapore and its subsidiaries are principally engaged in the design and product development, prototyping, tool and die fabrication, production and mechanical subassembly services to cater to the different needs of our customers who are mainly in the computer and computer peripherals industries. Apart from manufacturing metal parts, we have also started to produce plastic parts in December 2002 through the plastic injection moulding process for our existing customers as a form of value-added service to complement our existing business.
Our key customers include the Hewlett Packard Group, the Celestica Group, the Solectron Group, the Flextronics Group, the Venture Group, the BenQ Group and the ASUS Group. Further details of our major customers are set out on pages 74 and 75 on this Prospectus.
We grew from having one production facility in Singapore to a total of three production facilities in Singapore and four other production facilities in Shanghai (PRC), Suzhou (PRC), Johor (Malaysia) and near Ho Chi Minh City (Vietnam) respectively. As at 31 December 2002, we employed a total of 1,071 employees in Singapore, Malaysia, Taiwan, Vietnam and the PRC.
Our Competitive Strengths
- We provide vertically integrated precision manufacturing services
Our vertically integrated services have enabled us to be more responsive to the needs of our customers. We provide integrated manufacturing services ranging from design and product development, prototyping, tool and die fabrication, production and mechanical sub-assembly services to cater to the different needs of our customers who are mainly in the computer and computer peripherals industries.
- We have product design and development capabilities
We have the capability to translate an idea or concept described by our customers into a tangible design of a metal part with the necessary technical drawings and specifications. Our early involvement in our customers' product development stage allows us to provide feedback and suggestions on product design and manufacturability, so that our customers are able to produce quality products at competitive prices with a short lead time.
- We have tool and die design and fabrication capabilities
We have the manufacturing and engineering capabilities to provide customers with quality tool and die design and fabrication services.
- We provide quality products and services
We are committed to providing quality products and services to our customers at competitive prices. As an attestation of our commitment to quality, Allied Singapore received the "Singapore Quality Class Award" in July 2000, awarded by the then Singapore Productivity and Standards Board (currently known as SPRING Singapore) by achieving the standards prescribed under the Singapore Quality Award Framework for business excellence.
- We cultivate long term business relationships with our customers
We view our customers as our long term business partners and we cultivate the relationship and rapport upon mutual trust and co-operation. This is evidenced by the fact that in the last three financial years, an average of 94% of our sales is from the same customers.
- We operate in countries with low cost structures
As part of our continuing effort to lower our operating costs, we have located some of our labour intensive manufacturing operations in Malaysia, Vietnam and the PRC.
- Our production facilities are located close to our customers' operations
By locating our production facilities close to our customers' operations, we are able to respond to their needs quickly and provide just-in-time delivery services. This enables us to serve them more effectively, with a shorter lead time for the production of their products.
Our Business Strategy
- Expand our product range
We aim to expand our Group's existing product range by leveraging on our core business of manufacturing precision stamped metal parts.
- Horizontal integration of our manufacturing capabilities to complement our existing business
We aim to provide our customers with other value-added services which are complementary to our existing business, such as plastic injection moulding services which we have provided since December 2002.
- Maintain a low cost production structure
We aim to improve the cost efficiency of our processes by looking into more cost-efficient manufacturing locations and exploring ways in which we can lower our operating costs
- Locate close to our customers' operations
We will continuously explore opportunities to locate our facilities close to our customers operations to enable us to respond to their needs quickly and to facilitate promptness in the delivery of their products.
Our Future Plans
In general, our future plans in relation to our precision metal stamping business and our plastic injection moulding business are as follows:-
- Precision metal stamping
We will continue to market our products and services to potential customers in the precision manufacturing industry. We intend to use our proximity to leading MNCs in Malaysia, the PRC and Vietnam, where our manufacturing facilities are located, as a leverage to secure new MNC ustomers to broaden our customer base. We also constantly explore opportunities to broaden our product base by leveraging on our competency in precision metal stamping.
- Precision plastic injection moulding
We will continue to market this value-added service to our customers to complement our manufacturing of precision stamped metal parts. We have plans to manufacture plastic parts using insert moulding process in our Suzhou operation in the second half of 2003.
In particular, we plan to implement the above future plans by expanding the business of our subsidiaries as follows:
- Expand our business in the PRC
Recognizing the increasing trend of our customers setting up their manufacturing facilities in the PRC, we plan to tap the opportunities in the PRC market by expanding our existing production facilities in Shanghai and Suzhou.
With the completion of the construction of our production facility on the Second Land Parcel in Shanghai scheduled for the end of 2003, our total built-in area will be increased by approximately 20,000 sq m. The increased capacity will be utilized mainly for tool and die fabrication, mechanical sub-assembly, warehousing and the production of metal parts such as DVD-ROM and car cooling systems.
We intend to use part of the net proceeds of the Invitation to acquire new machines and equipment and to expand our warehousing and production facilities in Suzhou.
- Expand our business in Vietnam
The purpose for the expansion of our Vietnam production facilities is to support the operations of one of our major customers as well as to shift some of our labour intensive projects, such as storage peripherals and printers, from Singapore to Vietnam, with our Singapore operations focusing on "low volume high mix" product lines. We intend to build two production facilities, one for manufacturing of metal parts and the other for plastic parts, with a total built-in area of approximately 20,000 sq m. The construction of our two production facilities is scheduled to commence in the second half of 2003 and to be completed by the second half of 2004. We intend to utilize part of the net proceeds from the Invitation to partially finance the acquisition of the land use rights and the construction of the production facilities in Vietnam and for the acquisition of new machines and equipment to expand our production capacity in Vietnam.