CARLAW - General Announcement
Announcement Type: General Announcement
Company Name: HDM-CARLAW CORPORATION BERHAD (ACE Market)
Stock Name: CARLAW
Date Announced: 01/12/2010
Announcement Detail:
Regularisation Sponsor: M&A Securities Sdn Bhd
Sponsor: Same as above
Type: Announcement
Subject: HDM-CARLAW CORPORATION BERHAD ("HDM" or "COMPANY")
MONTHLY ANNOUNCEMENT ON THE STATUS OF PLAN TO REGULARISE FINANCIAL CONDITIONS PURSUANT TO GUIDANCE NOTE 3 ("GN3") AND GUIDANCE NOTE 5 ("GN5") OF BURSA MALAYSIA SECURITIES BERHAD ACE MARKET LISTING REQUIREMENTS ("AMLR")
Contents: Further to the announcement dated 1 November 2010, the Board of Directors of HDM wishes to inform that the Company has been granted an extension of time of the Restraining Order for a period of 90 days effective from 9 November 2010 to 6 February 2011 pursuant to Section 176(10) of the Companies Act, 1965.
The regularization plan by the Company to the Approving Authorities submitted on 2 September 2010 is currently pending approval.
This announcement is dated 1 December 2010.
Company Name: HDM-CARLAW CORPORATION BERHAD (ACE Market)
Stock Name: CARLAW
Date Announced: 01/12/2010
Announcement Detail:
Regularisation Sponsor: M&A Securities Sdn Bhd
Sponsor: Same as above
Type: Announcement
Subject: HDM-CARLAW CORPORATION BERHAD ("HDM" or "COMPANY")
MONTHLY ANNOUNCEMENT ON THE STATUS OF PLAN TO REGULARISE FINANCIAL CONDITIONS PURSUANT TO GUIDANCE NOTE 3 ("GN3") AND GUIDANCE NOTE 5 ("GN5") OF BURSA MALAYSIA SECURITIES BERHAD ACE MARKET LISTING REQUIREMENTS ("AMLR")
Contents: Further to the announcement dated 1 November 2010, the Board of Directors of HDM wishes to inform that the Company has been granted an extension of time of the Restraining Order for a period of 90 days effective from 9 November 2010 to 6 February 2011 pursuant to Section 176(10) of the Companies Act, 1965.
The regularization plan by the Company to the Approving Authorities submitted on 2 September 2010 is currently pending approval.
This announcement is dated 1 December 2010.
STEMLFE - Change in Audit Committee
Announcement Type: Change in Audit Committee
Company Name: STEMLIFE BERHAD (ACE Market)
Stock Name: STEMLFE
Date Announced: 01/12/2010
Announcement Detail:
Date of change: 30/11/2010
Type of change: Resignation
Designation: Member of Audit Committee
Directorate: Independent & Non Executive
Name: LOH KIAT LOON
Age: 59
Nationality: MALAYSIAN
Qualifications: Chartered Certified Accountant (FCCA), Chartered Secretary (ACIS)
Working experience and occupation: Mr. Loh is a qualified Chartered Certified Accountant as well as a Chartered Secretary, with over 30 years of post qualifying experience in various business sectors as well as different types of organisations. He joined Mechmar Corporation (Malaysia) Berhad as its Financial Controller back in 1998, with a wide range of experience gathered through various business environment such as manufacturing and plantations to service providers in semi-government organisations, MNC's and large local companies. Over his 20 years at Mechmar Corporation (Malaysia) Berhad, he had risen to the current position of Executive Director and the Group Financial Controller, responsible to the Board for Mechmar's Corporation (Malaysia) Berhad Group Financial Management and Policies, Treasury, Human Resources, Corporate Planning, New Investments and Divestment. Currently he is also the acting CEO for the Group's core boiler business in Malaysia and Indonesia.
Directorship of public companies (if any): Mechmar Corporation (Malaysia) Berhad
Family relationship with any director and/or major shareholder of the listed issuer: Nil
Any conflict of interests that he/she has with the listed issuer: Nil
Details of any interest in the securities of the listed issuer or its subsidiaries: Nil
Composition of Audit Committee (Name and Directorate of members after change): i) Chairman: Tengku Putra Haron Aminurrashid bin Tan Sri Tengku Hamid Jumat (Independent Non-Executive Director)
ii) Member: Loh Yoon Kwai (Independent Non-Executive Director)
Company Name: STEMLIFE BERHAD (ACE Market)
Stock Name: STEMLFE
Date Announced: 01/12/2010
Announcement Detail:
Date of change: 30/11/2010
Type of change: Resignation
Designation: Member of Audit Committee
Directorate: Independent & Non Executive
Name: LOH KIAT LOON
Age: 59
Nationality: MALAYSIAN
Qualifications: Chartered Certified Accountant (FCCA), Chartered Secretary (ACIS)
Working experience and occupation: Mr. Loh is a qualified Chartered Certified Accountant as well as a Chartered Secretary, with over 30 years of post qualifying experience in various business sectors as well as different types of organisations. He joined Mechmar Corporation (Malaysia) Berhad as its Financial Controller back in 1998, with a wide range of experience gathered through various business environment such as manufacturing and plantations to service providers in semi-government organisations, MNC's and large local companies. Over his 20 years at Mechmar Corporation (Malaysia) Berhad, he had risen to the current position of Executive Director and the Group Financial Controller, responsible to the Board for Mechmar's Corporation (Malaysia) Berhad Group Financial Management and Policies, Treasury, Human Resources, Corporate Planning, New Investments and Divestment. Currently he is also the acting CEO for the Group's core boiler business in Malaysia and Indonesia.
Directorship of public companies (if any): Mechmar Corporation (Malaysia) Berhad
Family relationship with any director and/or major shareholder of the listed issuer: Nil
Any conflict of interests that he/she has with the listed issuer: Nil
Details of any interest in the securities of the listed issuer or its subsidiaries: Nil
Composition of Audit Committee (Name and Directorate of members after change): i) Chairman: Tengku Putra Haron Aminurrashid bin Tan Sri Tengku Hamid Jumat (Independent Non-Executive Director)
ii) Member: Loh Yoon Kwai (Independent Non-Executive Director)
HDISPLY - General Announcement
Announcement Type: General Announcement
Company Name: H-DISPLAYS (MSC) BERHAD (ACE Market)
Stock Name: HDISPLY
Date Announced: 01/12/2010
Announcement Detail:
Regularisation Sponsor: M&A Securities Sdn Bhd
Sponsor: Same as above
Type: Announcement
Subject: H-DISPLAYS (MSC) BERHAD ("HDISPLY" OR "THE COMPANY")
- MONTHLY ANNOUNCEMENT ON THE STATUS OF THE COMPANY'S PLAN TO COMPLY WITH THE OBLIGATION TO REGULARISE ITS CONDITION PURSUANT TO GUIDANCE NOTE 3 OF THE LISTING REQUIREMENTS OF BURSA MALAYSIA SECURITIES BERHAD FOR THE ACE MARKET
Contents: Reference is made to the First Announcement made by the Company on 31 May 2010 and the subsequent monthly announcements made on 1 July 2010, 2 August 2010, 1 September 2010, 1 October 2010 and 1 November 2010 in compliance with Rule 4.1(b) of Guidance Note 3 of the Listing Requirements of Bursa Malaysia Securities Berhad for the ACE Market. The Board of Directors of HDISPLY wishes to inform that the Company is still in the midst of evaluating various options in its endeavour to formulate a plan to regularise the Company's financial condition ("Regularisation Plan").
Premised on the First Announcement and the monthly announcements, the last day for submission of the Regularisation Plan by the Company to the relevant authorities would be by 30 May 2011, which is approximately 6 months from the date hereof.
This announcement is dated 1 December 2010.
Company Name: H-DISPLAYS (MSC) BERHAD (ACE Market)
Stock Name: HDISPLY
Date Announced: 01/12/2010
Announcement Detail:
Regularisation Sponsor: M&A Securities Sdn Bhd
Sponsor: Same as above
Type: Announcement
Subject: H-DISPLAYS (MSC) BERHAD ("HDISPLY" OR "THE COMPANY")
- MONTHLY ANNOUNCEMENT ON THE STATUS OF THE COMPANY'S PLAN TO COMPLY WITH THE OBLIGATION TO REGULARISE ITS CONDITION PURSUANT TO GUIDANCE NOTE 3 OF THE LISTING REQUIREMENTS OF BURSA MALAYSIA SECURITIES BERHAD FOR THE ACE MARKET
Contents: Reference is made to the First Announcement made by the Company on 31 May 2010 and the subsequent monthly announcements made on 1 July 2010, 2 August 2010, 1 September 2010, 1 October 2010 and 1 November 2010 in compliance with Rule 4.1(b) of Guidance Note 3 of the Listing Requirements of Bursa Malaysia Securities Berhad for the ACE Market. The Board of Directors of HDISPLY wishes to inform that the Company is still in the midst of evaluating various options in its endeavour to formulate a plan to regularise the Company's financial condition ("Regularisation Plan").
Premised on the First Announcement and the monthly announcements, the last day for submission of the Regularisation Plan by the Company to the relevant authorities would be by 30 May 2011, which is approximately 6 months from the date hereof.
This announcement is dated 1 December 2010.
BJTOTO - DIRECTOR'S DEALING IN SECURITIES DURING CLOSED PERIOD
Announcement Type: General Announcement
Company Name: BERJAYA SPORTS TOTO BERHAD
Stock Name: BJTOTO
Date Announced: 01/12/2010
Announcement Detail:
Type: Announcement
Subject: DIRECTOR'S DEALING IN SECURITIES DURING CLOSED PERIOD
Contents: Further to our announcement on 9 November 2010 on the above and pursuant to Paragraphs 14.03 and 14.08 of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad in relation to the Directors' dealings in the securities of the Company, we wish to inform that Tan Sri Dato' Seri Vincent Tan Chee Yioun ("TSVT"), the Managing Director/Chief Executive Officer of Sports Toto Malaysia Sdn Bhd, a major subsidiary of Berjaya Sports Toto Berhad ("BToto") has dealt in the shares of BToto as set out in the table below.
Company Name: BERJAYA SPORTS TOTO BERHAD
Stock Name: BJTOTO
Date Announced: 01/12/2010
Announcement Detail:
Type: Announcement
Subject: DIRECTOR'S DEALING IN SECURITIES DURING CLOSED PERIOD
Contents: Further to our announcement on 9 November 2010 on the above and pursuant to Paragraphs 14.03 and 14.08 of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad in relation to the Directors' dealings in the securities of the Company, we wish to inform that Tan Sri Dato' Seri Vincent Tan Chee Yioun ("TSVT"), the Managing Director/Chief Executive Officer of Sports Toto Malaysia Sdn Bhd, a major subsidiary of Berjaya Sports Toto Berhad ("BToto") has dealt in the shares of BToto as set out in the table below.
PARAMON - General Announcement
Announcement Type: General Announcement
Submitting Merchant Bank: CIMB INVESTMENT BANK BERHAD
Company Name: PARAMOUNT CORPORATION BERHAD
Stock Name: PARAMON
Date Announced: 01/12/2010
Announcement Detail:
Type: Announcement
Subject: PARAMOUNT CORPORATION BERHAD ("PCB" OR THE "COMPANY")
PROPOSED DISPOSAL BY PARAMOUNT GLOBAL ASSETS SDN BHD ("PGA"), A WHOLLY-OWNED SUBSIDIARY OF PCB, OF ITS 20% EQUITY INTEREST IN JERNEH INSURANCE BERHAD ("JIB") TO ACE INA INTERNATIONAL HOLDINGS, LTD (FORMERLY KNOWN AS CIGNA INTERNATIONAL HOLDINGS, LTD) ("ACE INA") FOR A TOTAL CASH CONSIDERATION OF RM130.8 MILLION ("PROPOSED DISPOSAL")
Contents: -
Submitting Merchant Bank: CIMB INVESTMENT BANK BERHAD
Company Name: PARAMOUNT CORPORATION BERHAD
Stock Name: PARAMON
Date Announced: 01/12/2010
Announcement Detail:
Type: Announcement
Subject: PARAMOUNT CORPORATION BERHAD ("PCB" OR THE "COMPANY")
PROPOSED DISPOSAL BY PARAMOUNT GLOBAL ASSETS SDN BHD ("PGA"), A WHOLLY-OWNED SUBSIDIARY OF PCB, OF ITS 20% EQUITY INTEREST IN JERNEH INSURANCE BERHAD ("JIB") TO ACE INA INTERNATIONAL HOLDINGS, LTD (FORMERLY KNOWN AS CIGNA INTERNATIONAL HOLDINGS, LTD) ("ACE INA") FOR A TOTAL CASH CONSIDERATION OF RM130.8 MILLION ("PROPOSED DISPOSAL")
Contents: -
BKAWAN - Notice of Shares Buy Back - Immediate Announcement
Announcement Type: Notice of Shares Buy Back - Immediate Announcement
Company Name: BATU KAWAN BERHAD
Stock Name: BKAWAN
Date Announced: 01/12/2010
Announcement Detail:
Date of buy back: 01/12/2010
Description of shares purchased: Shares of RM1.00 each
Currency: Malaysian Ringgit (MYR)
Total number of shares purchased (units): 104,400
Minimum price paid for each share purchased ($$): 15.660
Maximum price paid for each share purchased ($$): 15.760
Total consideration paid ($$): 1,647,056.20
Number of shares purchased retained in treasury (units): 104,400
Number of shares purchased which are proposed to be cancelled (units): 0
Cumulative net outstanding treasury shares as at to-date (units): 17,483,600
Total number of shares purchased and/or held as treasury shares against the total number of outstanding shares of the listed issuer (%): 4.01
Company Name: BATU KAWAN BERHAD
Stock Name: BKAWAN
Date Announced: 01/12/2010
Announcement Detail:
Date of buy back: 01/12/2010
Description of shares purchased: Shares of RM1.00 each
Currency: Malaysian Ringgit (MYR)
Total number of shares purchased (units): 104,400
Minimum price paid for each share purchased ($$): 15.660
Maximum price paid for each share purchased ($$): 15.760
Total consideration paid ($$): 1,647,056.20
Number of shares purchased retained in treasury (units): 104,400
Number of shares purchased which are proposed to be cancelled (units): 0
Cumulative net outstanding treasury shares as at to-date (units): 17,483,600
Total number of shares purchased and/or held as treasury shares against the total number of outstanding shares of the listed issuer (%): 4.01
GOPENG - Extraordinary General Meeting of the Company held on 1 December 2010
Announcement Type: General Announcement
Company Name: GOPENG BERHAD
Stock Name: GOPENG
Date Announced: 01/12/2010
Announcement Detail:
Type: Announcement
Subject: Extraordinary General Meeting of the Company held on 1 December 2010
Contents: The Extraordinary General Meeting of the Company was duly held on 1 December 2010 at Crystal 1 Impiana Hotel Ipoh, 18 Jalan Raja Dr. Nazrin Shah (Jalan Gopeng) 30250 Ipoh, Perak Darul Ridzuzn at 12.00 noon chaired by the Executive Chairman, Dato' Mohd Salleh bin Hashim.
The Ordinary Resolution on the proposed disposal by the Company of 117,742,000 fully paid-up ordinary shares of RM1.00 each representing approximately 35.16% equity interest in Perak-Hanjoong Simen Sdn Bhd to YTL Cement Berhad for a disposal consideration of RM200 million to be wholly satisfied in cash was unanimously passed by shareholders at the meeting.
Company Name: GOPENG BERHAD
Stock Name: GOPENG
Date Announced: 01/12/2010
Announcement Detail:
Type: Announcement
Subject: Extraordinary General Meeting of the Company held on 1 December 2010
Contents: The Extraordinary General Meeting of the Company was duly held on 1 December 2010 at Crystal 1 Impiana Hotel Ipoh, 18 Jalan Raja Dr. Nazrin Shah (Jalan Gopeng) 30250 Ipoh, Perak Darul Ridzuzn at 12.00 noon chaired by the Executive Chairman, Dato' Mohd Salleh bin Hashim.
The Ordinary Resolution on the proposed disposal by the Company of 117,742,000 fully paid-up ordinary shares of RM1.00 each representing approximately 35.16% equity interest in Perak-Hanjoong Simen Sdn Bhd to YTL Cement Berhad for a disposal consideration of RM200 million to be wholly satisfied in cash was unanimously passed by shareholders at the meeting.
IJMPLNT - Acquisition of the remaining 40% of the issued and paid-up capital of IJM Biofuel Sdn Bhd
Announcement Type: General Announcement
Company Name: IJM PLANTATIONS BERHAD
Stock Name: IJMPLNT
Date Announced: 01/12/2010
Announcement Detail:
Type: Announcement
Subject: Acquisition of the remaining 40% of the issued and paid-up capital of IJM Biofuel Sdn Bhd
Contents: The Company has today entered into a Sale and Purchase of Shares Agreement with its joint venture partner, CTI Biofuels, LLC to acquire the remaining 1,000,000 ordinary shares of RM1 each, representing 40% of the issued and paid up capital of IJM Biofuel Sdn Bhd ("IJMBF") for a total cash consideration of RM1. With the acquisition, IJMBF will become a wholly-owned subsidiary of the Company.
IJMBF was formed in March 2006 for carrying on the bio-diesel business. However, the bio-diesel project of IJMBF was kept in abeyance due to the uncertainty of the prospects of the palm-based bio-diesel industry. The Company and CTI Biofuels, LLC have agreed to dissolve the joint venture arrangement. The Company will re-visit the bio-diesel project if there is positive development in future.
None of the Directors or the major shareholders of the Company, or persons connected with them, has any interest, direct or indirect, in the acquisition, and no approval of shareholders is required. The acquisition will not have any significant effect on the earnings or net assets per share of the Company for the financial year ending 31 March 2011.
Company Name: IJM PLANTATIONS BERHAD
Stock Name: IJMPLNT
Date Announced: 01/12/2010
Announcement Detail:
Type: Announcement
Subject: Acquisition of the remaining 40% of the issued and paid-up capital of IJM Biofuel Sdn Bhd
Contents: The Company has today entered into a Sale and Purchase of Shares Agreement with its joint venture partner, CTI Biofuels, LLC to acquire the remaining 1,000,000 ordinary shares of RM1 each, representing 40% of the issued and paid up capital of IJM Biofuel Sdn Bhd ("IJMBF") for a total cash consideration of RM1. With the acquisition, IJMBF will become a wholly-owned subsidiary of the Company.
IJMBF was formed in March 2006 for carrying on the bio-diesel business. However, the bio-diesel project of IJMBF was kept in abeyance due to the uncertainty of the prospects of the palm-based bio-diesel industry. The Company and CTI Biofuels, LLC have agreed to dissolve the joint venture arrangement. The Company will re-visit the bio-diesel project if there is positive development in future.
None of the Directors or the major shareholders of the Company, or persons connected with them, has any interest, direct or indirect, in the acquisition, and no approval of shareholders is required. The acquisition will not have any significant effect on the earnings or net assets per share of the Company for the financial year ending 31 March 2011.
BSTEAD - General Announcement
Announcement Type: General Announcement
Company Name: BOUSTEAD HOLDINGS BERHAD
Stock Name: BSTEAD
Date Announced: 01/12/2010
Announcement Detail:
Type: Announcement
Subject: DISPOSAL OF 1-ACRE COMMERCIAL LAND IN MUKIM PULAI, DISTRICT OF JOHOR BY MUTIARA RINI SDN BHD, A WHOLLY OWNED SUBSIDIARY OF BOUSTEAD HOLDINGS BERHAD TO BOUSTEAD PETROLEUM MARKETING SDN BHD ("DISPOSAL")
Contents: The Board of Directors of Boustead Holdings Berhad ("the Company") wishes to announce that Mutiara Rini Sdn Bhd ("MRSB"), a wholly owned subsidiary of the Company had on 1 December 2010 entered into a Sale and Purchase Agreement ("SPA") to dispose a 1-acre plot of commercial land which forms part of H.S.(D) 486033 PT No. PTD 176566 Mukim Pulai, District of Johor Bahru, State of Johor to Boustead Petroleum Marketing Sdn Bhd (Company No. 5783-T) ("BPMSB") for a total consideration of Ringgit Malaysia Three Million Nine Hundred and Sixty Three Thousand, Nine Hundred and Sixty Only (RM3,963,960.00) or RM91.00 per sq. ft. ("Disposal Price").
Please refer to the attachment for the full announcement.
Attachments: Announcemnt-SaleToBHPetrol(Johor).doc
Company Name: BOUSTEAD HOLDINGS BERHAD
Stock Name: BSTEAD
Date Announced: 01/12/2010
Announcement Detail:
Type: Announcement
Subject: DISPOSAL OF 1-ACRE COMMERCIAL LAND IN MUKIM PULAI, DISTRICT OF JOHOR BY MUTIARA RINI SDN BHD, A WHOLLY OWNED SUBSIDIARY OF BOUSTEAD HOLDINGS BERHAD TO BOUSTEAD PETROLEUM MARKETING SDN BHD ("DISPOSAL")
Contents: The Board of Directors of Boustead Holdings Berhad ("the Company") wishes to announce that Mutiara Rini Sdn Bhd ("MRSB"), a wholly owned subsidiary of the Company had on 1 December 2010 entered into a Sale and Purchase Agreement ("SPA") to dispose a 1-acre plot of commercial land which forms part of H.S.(D) 486033 PT No. PTD 176566 Mukim Pulai, District of Johor Bahru, State of Johor to Boustead Petroleum Marketing Sdn Bhd (Company No. 5783-T) ("BPMSB") for a total consideration of Ringgit Malaysia Three Million Nine Hundred and Sixty Three Thousand, Nine Hundred and Sixty Only (RM3,963,960.00) or RM91.00 per sq. ft. ("Disposal Price").
Please refer to the attachment for the full announcement.
Attachments: Announcemnt-SaleToBHPetrol(Johor).doc
CMSB - JOINT VENTURE AGREEMENT
Announcement Type: General Announcement
Company Name: CAHYA MATA SARAWAK BERHAD
Stock Name: CMSB
Date Announced: 01/12/2010
Announcement Detail:
Type: Announcement
Subject: JOINT VENTURE AGREEMENT
Contents: 1. INTRODUCTION
Pursuant to Paragraph 10.08 of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad ("Listing Requirements"), the Board of Directors ("Board") of Cahya Mata Sarawak Berhad ("CMS") wishes to announce that CMS Land Sdn Bhd ("CMS Land"), a 51%-owned subsidiary of CMS, had, on 1 December 2010, entered into a Joint Venture Agreement ("JVA") with Premier Cottage Sdn Bhd ("PCSB"), Boulevard Jaya Corporation Sdn Bhd ("BJSB"), Hikmat Majusama Sdn Bhd ("HMSB") and Isthmus Developments Sdn Bhd ("IDSB"), being the joint venture company, for the proposed joint venture to build, own and manage a four-star hotel and service apartments ("Hotel") located at the Kuching Isthmus, Kuching, Sarawak ("JV").
2. DETAILS OF THE PROPOSALS
2.1 Details of the JVA
Pursuant to the terms of the JVA, CMS Land, PCSB, BJSB and HMSB will subscribe for 300,000 new ordinary shares of RM1.00 each ("Shares") in IDSB ("Shares Subscription"), 5,049,998 new Shares in IDSB, 1,960,000 new Shares in IDSB and 1,960,000 new Shares in IDSB respectively at the par value of the said Shares for cash. PCSB shall also acquire the 2 existing Shares in IDSB from the existing shareholders.
Upon completion of the above, the issued and paid-up capital of IDSB will be increased to RM9,270,000.
In addition, pursuant to the terms of the JVA, CMS Land will inject two parcels of vacant land, being Lot 2839 and Lot 2852, Block 7, Muara Tebas land District, Kuching, totalling approximately 10.5 acres with a lease period of 99 years commencing on 5th May 2010 and expiring on 4th May 2109 ("Land") to IDSB for a total consideration of RM10,000,000 ("Land Consideration") to be satisfied via the issuance of 10,000,000 new Shares ("Consideration Shares") in IDSB ("Proposed Injection") at their par value. Based on the audited financial statements as at 31 December 2009, the net book value of the Land was approximately RM5.106 million. The Land has not been income generating and thus no profit is attributable to the Land.
(the Shares Subscription, Proposed Injection and the JV are collectively referred to as the "Proposals")
Further, PCSB shall have the rights, from time to time and at its sole discretion, to give written notice to IDSB to require IDSB to allot up to 80,730,000 new Shares in IDSB to PCSB, BJSB and HMSB such that IDSB's issued and paid-up capital will be increased to RM100,000,000 as set out in the attached Table A.
2.2 Details of the JV
The Hotel will be a four-star hotel with 381 hotel rooms and 96 units of service apartments. The approval for the development plan for the Hotel has been obtained on 21 June 2010. Total costs of the Hotel (including outfitting, furniture, fittings and equipment, but excluding financing costs and contingencies) is estimated to be approximately RM380 million and will be financed by IDSB via a combination of issuance of Shares as detailed in Section 2.1 above, borrowings from banks or financial institutions, as well as advances from the JV partners (save for CMS Land) up to RM50 million (as set out in Section 2.8(e) of this announcement).
Building works for the Hotel is expected to commence in the first quarter of 2011 and, barring anything unforeseen, completed by December 2013.
2.3 Information on the Joint Venture Company
IDSB was incorporated in Malaysia under the Companies Act, 1965 on 17 January 2008. The authorised capital of IDSB is RM100,000 divided into 100,000 ordinary shares of RM1.00 each ("Shares") and the issued and paid-up share capital is RM2 divided into 2 Shares. IDSB, which is currently a dormant company, is the JV vehicle and it is also the company that undertakes the development of the Hotel.
The existing directors of IDSB are Syed Hizam Bin Syed Mahmood Ezzularab Abdul-Moez Alsagoff and Isaac Lugun whilst the existing shareholders of IDSB are Syed Hizam Bin Syed Mahmood Ezzularab Abdul-Moez Alsagoff and Isaac Lugun, each holding one (1) Share in IDSB.
2.4 Information on the Parties to the JV
2.4.1 Information on CMS Land
CMS Land was incorporated in Malaysia under the Companies Act, 1965 on 20 November 1996 under the name of PPES Works Property Sdn Bhd. The company changed its name to CMS Land on 8 July 2004. The authorised capital of CMS Land is RM20,000,000 divided into 20,000,000 Shares and the issued and paid-up share capital is RM20,000,000 divided into 20,000,000 Shares. CMS Land is a 51%-owned subsidiary of CMS Property Development Sdn Bhd, which in turn is wholly owned by CMS. The other shareholder of CMS Land is Sarawak Economic Development Corporation. The principal activities of CMS Land are property holding, property development and construction.
2.4.2 Information on BJSB
BJSB was incorporated in Malaysia under the Companies Act, 1965 on 21 October 2004. The authorised and issued and paid-up share capital of BJSB is RM25,000,000 divided into 25,000,000 Shares. The principal activity of BJSB is in investment holding.
2.4.3 Information on HMSB
HMSB was incorporated in Malaysia under the Companies Act, 1965 on 16 April 2007. The authorised capital of HMSB is RM100,000 divided into 100,000 Shares and issued and paid-up share capital is RM2.00 divided into 2 Shares. The principal activity of HMSB is in investment holding.
2.4.4 Information on PCSB
PCSB was incorporated in Malaysia under the Companies Act, 1965 on 4 January 2005. The authorised capital of PCSB is RM24,100,000.00 divided into 100,000 Shares and 24,000,000 Redeemable Cumulative Preference Shares of RM1.00 each. The total issued and paid-up share capital is RM24,000,002.00 divided into 2 Shares and 24,000,000 Redeemable Cumulative Preference Shares of RM1.00 each. The principal activity of PCSB is in investment holding.
2.5 Basis and Justification for the Land Consideration
The Land Consideration was based on the market value of the Land of RM10,000,000 as appraised by VPC Alliance (Sarawak) Sdn Bhd, an independent firm of valuers on 23 August 2010, and the basis of valuation is the market value of the subject property using the Comparative Method of valuation.
2.6 Mode of Satisfaction and Sources of Funding
The Land Consideration will be satisfied wholly via issuance of 10,000,000 new Shares in IDSB.
CMS Land will fund its cash investment in the JV of RM300,000 through internally generated funds.
2.7 Ranking of the Shares
The new Shares to be issued pursuant to the Shares Subscription and the Consideration Shares shall, upon allotment and issue, rank pari passu in all respects with the then existing Shares in IDSB except that they would not be entitled to any dividends, rights, allotments and/or other distributions which may be declared, made or paid to shareholders, the entitlement date of which is prior to the date of allotment of the said Shares.
The Shares in IDSB will be held for long term holding by CMS Land.
2.8 Salient Terms of the JVA
A summary of the salient terms of the JVA, inter-alia, are as follows:-
(a) IDSB shall increase its authorised share capital to RM200 million.
(b) The 2 current shareholders will transfer their subscriber shares (1 share each) in IDSB to PCSB; and PCSB, BJSB, CMS Land and HMSB will each subscribe for new shares to be paid for in cash at par.
(c) In addition, CMS Land will cause to be transferred the Land valued at RM10 million and in return, IDSB will allot to CMS Land 10 million Shares.
(d) PCSB may from time to time give a call notice requiring IDSB to call for allotment of such number of new IDSB Shares to PCSB, HMSB and BJSB until such time IDSB's total issued and paid-up share capital has reached RM100,000,000.
(e) Each of PCSB, HMSB and BJSB agrees that it shall finance IDSB and its project by way of shareholders' advance to IDSB up to RM50 million.
(f) CMS Land shall not be required under any circumstances to provide any shareholders' advance to IDSB nor to provide, unless it so agrees, any guarantees or security that may be required for any financing required.
(g) Any non-defaulting shareholders may terminate the JVA in the event if:
(i) a shareholder fails to perform or observe any material undertaking or obligation in the JVA;
(ii) any of the representations and warranties given by a shareholder becomes false or misleading;
(iii) a receiver(s) is appointed over a shareholder or its assets; and
(iv) a shareholder becomes insolvent or enters into an arrangement with its creditors or if it is being wound up.
(h) The JVA is conditional upon the following:-
(a) where applicable, approval by the public authorities for CMS Land to enter into the JVA and the transaction contemplated herein; and
(b) where necessary, a resolution being passed at an extraordinary general meeting and/or the respective boards of PCSB, BJSB, CMS Land, HMSB, IDSB and CMS approving the entering of the JVA and the transaction as contemplated herein.
(i) The JVA shall take effect upon its execution and shall continue in full force and effect unless and until:
(i) the JVA is rescinded by non-satisfaction of the condition precedent as provided in Clause 3.1 of the JVA (details are set out in Note (h) above);
(ii) IDSB is wound up in accordance with the provisions of the Companies Act 1965 or otherwise ceases to exist as a separate corporate entity; or
(iii) the JVA is terminated in accordance with the provisions of the JVA.
(j) If the conditions precedent referred to in Clause 3.1 of the JVA (details are set out in Note (h) above) are not satisfied or waived (to the extent legally possible) within 6 months from the date of the JVA, the JVA shall terminate and be of no further force and effect and no party shall have any claim under the JVA against any other party (save for any antecedent breaches and subject to confidentially provision set out in the JVA).
2.9 Assumption of liabilities
Save for the RM10,300,000 pursuant to the Shares Subscription and the Proposed Injection, there are no liabilities, contingent liabilities or guarantees to be assumed by CMS Land or CMS arising from the JVA or JV.
2.10 Additional financial commitment required
There are no additional financial commitment required from CMS Land nor CMS for the JV as all the additional financial commitments for the Hotel will be borne by PCSB, BJSB, HMSB and IDSB.
2.11 Highest Percentage Ratio
The highest percentage ratio applicable for the Proposals pursuant to Paragraph 10.02(g) of the Listing Requirements is 0.81%.
3. RATIONALE AND PROSPECTS FOR THE JOINT VENTURE
CMS Land is the land owner and property developer for the Kuching Isthmus Development Project ("Isthmus Development"). The Isthmus Development which is intended to become Kuching's new Central Business District is a proposed mixed commercial and residential development project that include convention and exhibition centre, transport hub, tertiary educational institutions, marina and other housing/commercial developments. The Borneo Convention and Exhibition Centre ("BCCK"), which is a key feature of the Isthmus Development was completed in August 2009.
The development of the Hotel, which is located within the Isthmus Development, will support BCCK to attract more users as well as to act as a catalyst to accelerate further development of CMS Land's adjoining land banks in the Isthmus Development into a commercial hub and satellite city for Kuching. This is also in line with CMS and its subsidiaries' ("CMS Group") plan of expanding its operations in property investment and holding.
The Sarawak State Government is actively promoting the State as a destination for conventions and tourism. This coupled with the relative affordability of air travel to the State with more airlines servicing the State will augur well for the development of the Hotel.
4. RISK FACTORS
4.1 Business Risk
The leisure and hotel development business is subject to certain risks inherent in the tourism and property industries. Such risks include amongst others, the general economic and political climate, customer preferences, the overall environmental factors such as outbreak of diseases (such as Severe Acute Respiratory Syndrome (SARS) and H1N1) and weather conditions in the region, the cyclical cycle nature of the property market, changes in government legislation, changes in legal and environment framework, building material shortages, increase in cost of labour and fuel and other general business and credit conditions.
The Board believes that CMS Land and the JV partners have qualified and experienced personnel, who are able to plan, mitigate and minimise business risks inherent in the industries in which it operates.
4.2 Capital Intensive
Under the terms of the JVA, the JV partners have committed to a shareholders' advance of RM50 million and equity injection of RM100 million to IDSB to finance the construction of the Hotel.
The Hotel requires significant capital expenditure and IDSB will need to procure additional debt financing and/or equity fund-raising in the future to fund the Hotel. Any future equity fund-raising (in addition to the abovementioned equity injection) could lead to CMS Land's equity interest in IDSB being diluted, should CMS elect not to subscribe for any new Shares in IDSB.
Pursuant to the JVA, save for the RM10,300,000 for the Share Subscription and the Proposed Injection, there is no obligation for CMS to subscribe for additional Shares in IDSB nor shareholders' advances.
The Board believes that the CMS Group has always maintained sound cash management practice and close review of CMS' Group financials. Any future fund-raising by IDSB will be carefully evaluated to ensure that the risk management strategies of CMS Land are continuously aligned with those of CMS Group; and any gearing level, corresponding finance cost and interest cover are proposed that they are considered in CMS Group's long term plan, investment and capital allocations.
4.3 Non-Completion of the JVA
In the event the conditions precedent in the JVA are not met, the JV will not be completed. The non-completion will result in CMS not being able to form the JV and obtain the benefits of the JV as disclosed in Section 3 of this announcement.
The JV partners are committed to the completion of the JVA and will endeavor to ensure the successful completion of the JVA and the Hotel.
5. EFFECTS OF THE PROPOSALS
5.1 Share Capital and Major Shareholders' Shareholdings
The Proposals are not expected to have any effect on the issued and paid-up share capital and major shareholding structure of CMS.
5.2 Net Assets
The Proposals are not expected to have any material effect on the net assets of CMS Group for the financial year ending 31 December 2010.
5.3 Earnings
The Proposals are not expected to have any material effect on the earnings of CMS Group for the financial year ending 31 December 2010.
CMS Group had acquired the Land in 1997 for approximately RM5.106 million. The Proposed Injection is expected to result in a net gain of approximately RM1.721 million to the CMS Group.
6. APPROVALS REQUIRED
The Proposals are not subject to the approval of any statutory body nor the approval of shareholders of CMS.
7. INTEREST OF DIRECTORS, MAJOR SHAREHOLDERS AND PERSONS CONNECTED WITH THEM
Datin Hanifah Hajar Taib ("Datin Hanifah") (a major shareholder of CMS) is a major shareholder of PCSB. Datin Hanifah is the spouse of Datuk Syed Ahmad Alwee Alsree (Group Executive Director of CMS) and sister of Dato Sri Mahmud Abu Bekir Taib (a major shareholder and Deputy Group Chairman of CMS), Jamilah Hamidah Taib (a major indirect shareholder of CMS) and Dato Sri Sulaiman Abdul Rahman Taib (major shareholder of CMS) and a child of the late Lejla Taib (a major shareholder of CMS). (Datuk Syed Ahmad Alwee Alsree and Dato Sri Mahmud Abu Bekir Taib are collectively referred to as "Related Board Members").
Datin Hanifah is also a director and major shareholder of Majaharta Sdn Bhd (a major shareholder of CMS).
The Related Board members are deemed interested in the Proposals and have abstained from all Board's deliberations in respect of the Proposals.
In view of the above, the Proposals are deemed a related party transaction under the Listing Requirements.
Save for the above, none of the other directors, major shareholders or persons connected to them have any interest in the Proposals.
There was no transaction between CMSB Group and Datin Hanifah and PCSB in the preceding twelve (12) months.
8. STATEMENTS BY DIRECTORS
The Board of Directors of CMS (other than the Related Board Members), having considered the following:-
(a) that the Land Consideration is based on the market value apprised by an independent valuer; and
(b) the rationale, prospectus and benefits to CMS Group as set out in Section 3 of this announcement;
is of the opinion that the Proposals are:-
(a) in the best interest of CMS;
(b) fair, reasonable and on normal commercial terms; and
(c) not detrimental to the interest of the minority shareholders.
9. STATEMENTS BY AUDIT COMMITTEE
The Audit Committee of CMS, having considered the following:-
(a) that the Land Consideration is based on the market value apprised by an independent valuer; and
(b) the rationale, prospectus and benefits to CMS Group as set out in Section 3 of this announcement;
is of the opinion that the Proposals are:-
(a) in the best interest of CMS;
(b) fair, reasonable and on normal commercial terms; and
(c) not detrimental to the interest of the minority shareholders.
10. ESTIMATED TIME FRAME FOR COMPLETION
Barring unforeseeable circumstances, the Share Subscription and the Proposed Injection are expected to be completed within 6 months from the date of the JVA.
11. DOCUMENTS FOR INSPECTION
The JVA and the valuation report are available for inspection at the registered office of CMS at Level 6 Wisma Mahmud, Jalan Sungai Sarawak, 93100, Kuching, Sarawak from Mondays to Fridays (except public holidays) during business hours, for a period of three (3) months from the date of this announcement.
This announcement is dated 1 December 2010.
Attachments: TABLE A.pdf
Company Name: CAHYA MATA SARAWAK BERHAD
Stock Name: CMSB
Date Announced: 01/12/2010
Announcement Detail:
Type: Announcement
Subject: JOINT VENTURE AGREEMENT
Contents: 1. INTRODUCTION
Pursuant to Paragraph 10.08 of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad ("Listing Requirements"), the Board of Directors ("Board") of Cahya Mata Sarawak Berhad ("CMS") wishes to announce that CMS Land Sdn Bhd ("CMS Land"), a 51%-owned subsidiary of CMS, had, on 1 December 2010, entered into a Joint Venture Agreement ("JVA") with Premier Cottage Sdn Bhd ("PCSB"), Boulevard Jaya Corporation Sdn Bhd ("BJSB"), Hikmat Majusama Sdn Bhd ("HMSB") and Isthmus Developments Sdn Bhd ("IDSB"), being the joint venture company, for the proposed joint venture to build, own and manage a four-star hotel and service apartments ("Hotel") located at the Kuching Isthmus, Kuching, Sarawak ("JV").
2. DETAILS OF THE PROPOSALS
2.1 Details of the JVA
Pursuant to the terms of the JVA, CMS Land, PCSB, BJSB and HMSB will subscribe for 300,000 new ordinary shares of RM1.00 each ("Shares") in IDSB ("Shares Subscription"), 5,049,998 new Shares in IDSB, 1,960,000 new Shares in IDSB and 1,960,000 new Shares in IDSB respectively at the par value of the said Shares for cash. PCSB shall also acquire the 2 existing Shares in IDSB from the existing shareholders.
Upon completion of the above, the issued and paid-up capital of IDSB will be increased to RM9,270,000.
In addition, pursuant to the terms of the JVA, CMS Land will inject two parcels of vacant land, being Lot 2839 and Lot 2852, Block 7, Muara Tebas land District, Kuching, totalling approximately 10.5 acres with a lease period of 99 years commencing on 5th May 2010 and expiring on 4th May 2109 ("Land") to IDSB for a total consideration of RM10,000,000 ("Land Consideration") to be satisfied via the issuance of 10,000,000 new Shares ("Consideration Shares") in IDSB ("Proposed Injection") at their par value. Based on the audited financial statements as at 31 December 2009, the net book value of the Land was approximately RM5.106 million. The Land has not been income generating and thus no profit is attributable to the Land.
(the Shares Subscription, Proposed Injection and the JV are collectively referred to as the "Proposals")
Further, PCSB shall have the rights, from time to time and at its sole discretion, to give written notice to IDSB to require IDSB to allot up to 80,730,000 new Shares in IDSB to PCSB, BJSB and HMSB such that IDSB's issued and paid-up capital will be increased to RM100,000,000 as set out in the attached Table A.
2.2 Details of the JV
The Hotel will be a four-star hotel with 381 hotel rooms and 96 units of service apartments. The approval for the development plan for the Hotel has been obtained on 21 June 2010. Total costs of the Hotel (including outfitting, furniture, fittings and equipment, but excluding financing costs and contingencies) is estimated to be approximately RM380 million and will be financed by IDSB via a combination of issuance of Shares as detailed in Section 2.1 above, borrowings from banks or financial institutions, as well as advances from the JV partners (save for CMS Land) up to RM50 million (as set out in Section 2.8(e) of this announcement).
Building works for the Hotel is expected to commence in the first quarter of 2011 and, barring anything unforeseen, completed by December 2013.
2.3 Information on the Joint Venture Company
IDSB was incorporated in Malaysia under the Companies Act, 1965 on 17 January 2008. The authorised capital of IDSB is RM100,000 divided into 100,000 ordinary shares of RM1.00 each ("Shares") and the issued and paid-up share capital is RM2 divided into 2 Shares. IDSB, which is currently a dormant company, is the JV vehicle and it is also the company that undertakes the development of the Hotel.
The existing directors of IDSB are Syed Hizam Bin Syed Mahmood Ezzularab Abdul-Moez Alsagoff and Isaac Lugun whilst the existing shareholders of IDSB are Syed Hizam Bin Syed Mahmood Ezzularab Abdul-Moez Alsagoff and Isaac Lugun, each holding one (1) Share in IDSB.
2.4 Information on the Parties to the JV
2.4.1 Information on CMS Land
CMS Land was incorporated in Malaysia under the Companies Act, 1965 on 20 November 1996 under the name of PPES Works Property Sdn Bhd. The company changed its name to CMS Land on 8 July 2004. The authorised capital of CMS Land is RM20,000,000 divided into 20,000,000 Shares and the issued and paid-up share capital is RM20,000,000 divided into 20,000,000 Shares. CMS Land is a 51%-owned subsidiary of CMS Property Development Sdn Bhd, which in turn is wholly owned by CMS. The other shareholder of CMS Land is Sarawak Economic Development Corporation. The principal activities of CMS Land are property holding, property development and construction.
2.4.2 Information on BJSB
BJSB was incorporated in Malaysia under the Companies Act, 1965 on 21 October 2004. The authorised and issued and paid-up share capital of BJSB is RM25,000,000 divided into 25,000,000 Shares. The principal activity of BJSB is in investment holding.
2.4.3 Information on HMSB
HMSB was incorporated in Malaysia under the Companies Act, 1965 on 16 April 2007. The authorised capital of HMSB is RM100,000 divided into 100,000 Shares and issued and paid-up share capital is RM2.00 divided into 2 Shares. The principal activity of HMSB is in investment holding.
2.4.4 Information on PCSB
PCSB was incorporated in Malaysia under the Companies Act, 1965 on 4 January 2005. The authorised capital of PCSB is RM24,100,000.00 divided into 100,000 Shares and 24,000,000 Redeemable Cumulative Preference Shares of RM1.00 each. The total issued and paid-up share capital is RM24,000,002.00 divided into 2 Shares and 24,000,000 Redeemable Cumulative Preference Shares of RM1.00 each. The principal activity of PCSB is in investment holding.
2.5 Basis and Justification for the Land Consideration
The Land Consideration was based on the market value of the Land of RM10,000,000 as appraised by VPC Alliance (Sarawak) Sdn Bhd, an independent firm of valuers on 23 August 2010, and the basis of valuation is the market value of the subject property using the Comparative Method of valuation.
2.6 Mode of Satisfaction and Sources of Funding
The Land Consideration will be satisfied wholly via issuance of 10,000,000 new Shares in IDSB.
CMS Land will fund its cash investment in the JV of RM300,000 through internally generated funds.
2.7 Ranking of the Shares
The new Shares to be issued pursuant to the Shares Subscription and the Consideration Shares shall, upon allotment and issue, rank pari passu in all respects with the then existing Shares in IDSB except that they would not be entitled to any dividends, rights, allotments and/or other distributions which may be declared, made or paid to shareholders, the entitlement date of which is prior to the date of allotment of the said Shares.
The Shares in IDSB will be held for long term holding by CMS Land.
2.8 Salient Terms of the JVA
A summary of the salient terms of the JVA, inter-alia, are as follows:-
(a) IDSB shall increase its authorised share capital to RM200 million.
(b) The 2 current shareholders will transfer their subscriber shares (1 share each) in IDSB to PCSB; and PCSB, BJSB, CMS Land and HMSB will each subscribe for new shares to be paid for in cash at par.
(c) In addition, CMS Land will cause to be transferred the Land valued at RM10 million and in return, IDSB will allot to CMS Land 10 million Shares.
(d) PCSB may from time to time give a call notice requiring IDSB to call for allotment of such number of new IDSB Shares to PCSB, HMSB and BJSB until such time IDSB's total issued and paid-up share capital has reached RM100,000,000.
(e) Each of PCSB, HMSB and BJSB agrees that it shall finance IDSB and its project by way of shareholders' advance to IDSB up to RM50 million.
(f) CMS Land shall not be required under any circumstances to provide any shareholders' advance to IDSB nor to provide, unless it so agrees, any guarantees or security that may be required for any financing required.
(g) Any non-defaulting shareholders may terminate the JVA in the event if:
(i) a shareholder fails to perform or observe any material undertaking or obligation in the JVA;
(ii) any of the representations and warranties given by a shareholder becomes false or misleading;
(iii) a receiver(s) is appointed over a shareholder or its assets; and
(iv) a shareholder becomes insolvent or enters into an arrangement with its creditors or if it is being wound up.
(h) The JVA is conditional upon the following:-
(a) where applicable, approval by the public authorities for CMS Land to enter into the JVA and the transaction contemplated herein; and
(b) where necessary, a resolution being passed at an extraordinary general meeting and/or the respective boards of PCSB, BJSB, CMS Land, HMSB, IDSB and CMS approving the entering of the JVA and the transaction as contemplated herein.
(i) The JVA shall take effect upon its execution and shall continue in full force and effect unless and until:
(i) the JVA is rescinded by non-satisfaction of the condition precedent as provided in Clause 3.1 of the JVA (details are set out in Note (h) above);
(ii) IDSB is wound up in accordance with the provisions of the Companies Act 1965 or otherwise ceases to exist as a separate corporate entity; or
(iii) the JVA is terminated in accordance with the provisions of the JVA.
(j) If the conditions precedent referred to in Clause 3.1 of the JVA (details are set out in Note (h) above) are not satisfied or waived (to the extent legally possible) within 6 months from the date of the JVA, the JVA shall terminate and be of no further force and effect and no party shall have any claim under the JVA against any other party (save for any antecedent breaches and subject to confidentially provision set out in the JVA).
2.9 Assumption of liabilities
Save for the RM10,300,000 pursuant to the Shares Subscription and the Proposed Injection, there are no liabilities, contingent liabilities or guarantees to be assumed by CMS Land or CMS arising from the JVA or JV.
2.10 Additional financial commitment required
There are no additional financial commitment required from CMS Land nor CMS for the JV as all the additional financial commitments for the Hotel will be borne by PCSB, BJSB, HMSB and IDSB.
2.11 Highest Percentage Ratio
The highest percentage ratio applicable for the Proposals pursuant to Paragraph 10.02(g) of the Listing Requirements is 0.81%.
3. RATIONALE AND PROSPECTS FOR THE JOINT VENTURE
CMS Land is the land owner and property developer for the Kuching Isthmus Development Project ("Isthmus Development"). The Isthmus Development which is intended to become Kuching's new Central Business District is a proposed mixed commercial and residential development project that include convention and exhibition centre, transport hub, tertiary educational institutions, marina and other housing/commercial developments. The Borneo Convention and Exhibition Centre ("BCCK"), which is a key feature of the Isthmus Development was completed in August 2009.
The development of the Hotel, which is located within the Isthmus Development, will support BCCK to attract more users as well as to act as a catalyst to accelerate further development of CMS Land's adjoining land banks in the Isthmus Development into a commercial hub and satellite city for Kuching. This is also in line with CMS and its subsidiaries' ("CMS Group") plan of expanding its operations in property investment and holding.
The Sarawak State Government is actively promoting the State as a destination for conventions and tourism. This coupled with the relative affordability of air travel to the State with more airlines servicing the State will augur well for the development of the Hotel.
4. RISK FACTORS
4.1 Business Risk
The leisure and hotel development business is subject to certain risks inherent in the tourism and property industries. Such risks include amongst others, the general economic and political climate, customer preferences, the overall environmental factors such as outbreak of diseases (such as Severe Acute Respiratory Syndrome (SARS) and H1N1) and weather conditions in the region, the cyclical cycle nature of the property market, changes in government legislation, changes in legal and environment framework, building material shortages, increase in cost of labour and fuel and other general business and credit conditions.
The Board believes that CMS Land and the JV partners have qualified and experienced personnel, who are able to plan, mitigate and minimise business risks inherent in the industries in which it operates.
4.2 Capital Intensive
Under the terms of the JVA, the JV partners have committed to a shareholders' advance of RM50 million and equity injection of RM100 million to IDSB to finance the construction of the Hotel.
The Hotel requires significant capital expenditure and IDSB will need to procure additional debt financing and/or equity fund-raising in the future to fund the Hotel. Any future equity fund-raising (in addition to the abovementioned equity injection) could lead to CMS Land's equity interest in IDSB being diluted, should CMS elect not to subscribe for any new Shares in IDSB.
Pursuant to the JVA, save for the RM10,300,000 for the Share Subscription and the Proposed Injection, there is no obligation for CMS to subscribe for additional Shares in IDSB nor shareholders' advances.
The Board believes that the CMS Group has always maintained sound cash management practice and close review of CMS' Group financials. Any future fund-raising by IDSB will be carefully evaluated to ensure that the risk management strategies of CMS Land are continuously aligned with those of CMS Group; and any gearing level, corresponding finance cost and interest cover are proposed that they are considered in CMS Group's long term plan, investment and capital allocations.
4.3 Non-Completion of the JVA
In the event the conditions precedent in the JVA are not met, the JV will not be completed. The non-completion will result in CMS not being able to form the JV and obtain the benefits of the JV as disclosed in Section 3 of this announcement.
The JV partners are committed to the completion of the JVA and will endeavor to ensure the successful completion of the JVA and the Hotel.
5. EFFECTS OF THE PROPOSALS
5.1 Share Capital and Major Shareholders' Shareholdings
The Proposals are not expected to have any effect on the issued and paid-up share capital and major shareholding structure of CMS.
5.2 Net Assets
The Proposals are not expected to have any material effect on the net assets of CMS Group for the financial year ending 31 December 2010.
5.3 Earnings
The Proposals are not expected to have any material effect on the earnings of CMS Group for the financial year ending 31 December 2010.
CMS Group had acquired the Land in 1997 for approximately RM5.106 million. The Proposed Injection is expected to result in a net gain of approximately RM1.721 million to the CMS Group.
6. APPROVALS REQUIRED
The Proposals are not subject to the approval of any statutory body nor the approval of shareholders of CMS.
7. INTEREST OF DIRECTORS, MAJOR SHAREHOLDERS AND PERSONS CONNECTED WITH THEM
Datin Hanifah Hajar Taib ("Datin Hanifah") (a major shareholder of CMS) is a major shareholder of PCSB. Datin Hanifah is the spouse of Datuk Syed Ahmad Alwee Alsree (Group Executive Director of CMS) and sister of Dato Sri Mahmud Abu Bekir Taib (a major shareholder and Deputy Group Chairman of CMS), Jamilah Hamidah Taib (a major indirect shareholder of CMS) and Dato Sri Sulaiman Abdul Rahman Taib (major shareholder of CMS) and a child of the late Lejla Taib (a major shareholder of CMS). (Datuk Syed Ahmad Alwee Alsree and Dato Sri Mahmud Abu Bekir Taib are collectively referred to as "Related Board Members").
Datin Hanifah is also a director and major shareholder of Majaharta Sdn Bhd (a major shareholder of CMS).
The Related Board members are deemed interested in the Proposals and have abstained from all Board's deliberations in respect of the Proposals.
In view of the above, the Proposals are deemed a related party transaction under the Listing Requirements.
Save for the above, none of the other directors, major shareholders or persons connected to them have any interest in the Proposals.
There was no transaction between CMSB Group and Datin Hanifah and PCSB in the preceding twelve (12) months.
8. STATEMENTS BY DIRECTORS
The Board of Directors of CMS (other than the Related Board Members), having considered the following:-
(a) that the Land Consideration is based on the market value apprised by an independent valuer; and
(b) the rationale, prospectus and benefits to CMS Group as set out in Section 3 of this announcement;
is of the opinion that the Proposals are:-
(a) in the best interest of CMS;
(b) fair, reasonable and on normal commercial terms; and
(c) not detrimental to the interest of the minority shareholders.
9. STATEMENTS BY AUDIT COMMITTEE
The Audit Committee of CMS, having considered the following:-
(a) that the Land Consideration is based on the market value apprised by an independent valuer; and
(b) the rationale, prospectus and benefits to CMS Group as set out in Section 3 of this announcement;
is of the opinion that the Proposals are:-
(a) in the best interest of CMS;
(b) fair, reasonable and on normal commercial terms; and
(c) not detrimental to the interest of the minority shareholders.
10. ESTIMATED TIME FRAME FOR COMPLETION
Barring unforeseeable circumstances, the Share Subscription and the Proposed Injection are expected to be completed within 6 months from the date of the JVA.
11. DOCUMENTS FOR INSPECTION
The JVA and the valuation report are available for inspection at the registered office of CMS at Level 6 Wisma Mahmud, Jalan Sungai Sarawak, 93100, Kuching, Sarawak from Mondays to Fridays (except public holidays) during business hours, for a period of three (3) months from the date of this announcement.
This announcement is dated 1 December 2010.
Attachments: TABLE A.pdf
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