KUALA LUMPUR: Tan Sri Lim Kang Hoo, in his personal capacity as a major shareholder of Ekovest Bhd, Knusford Bhd, Iskandar Waterfront Holdings Sdn Bhd (IWH) and Iskandar Waterfront City Bhd (IWCity), has served a letter of proposals to convey his intention to undertake a reorganisation, rationalisation and merger proposal involving these companies, for the consideration of their respective boards of directors.
Ekovest owns approximately 62% of PLS Plantations Bhd.
In a statement, Lim said his proposals were intended to streamline, reorganise, rationalise and merge the businesses and assets currently owned and controlled by him and persons acting in concert, through these various public-listed and non-listed companies, as well as consolidate his direct shareholdings in these various companies.
“The proposals will transform the enlarged Ekovest group into a listed public-private-partnership conglomerate in Malaysia, with interests in construction, property development, infrastructure, and plantations.
“Furthermore, the proposals are aimed at mitigating any potential conflict of interest and speculation relating to the alignment of interest of Lim, as a major shareholder of the companies,” Lim said.
The proposals will also eliminate many of the existing recurrent related party transactions and transfer pricing concerns among these companies, moving forward.
The first proposal involves the proposed merger of the construction businesses of Ekovest and Knusford, whereby Knusford acquires the entire issued share capital of Ekovest Construction Sdn Bhd – a wholly-owned subsidiary of Ekovest.
The purchase consideration payable by Knusford to Ekovest is proposed to be satisfied via the issuance of new ordinary shares in Knusford at the proposed issue price of RM0.60 per new Knusford share.
The second proposal involves the proposed acquisition by Ekovest of 4 parcels of land spanning approximately 17 acres.
These land assets are located in Johor Bahru, and are intended for two potential transit-oriented developments (TOD) along the alignment for the Johor Bahru–Singapore Rapid Transit System Link.
The purchase consideration payable by Ekovest to the vendors of TOD 2 and TOD 3 is proposed to be satisfied via the combination of cash and the issuance of new ordinary shares in Ekovest, at the proposed issue price of RM0.60 per new Ekovest share.
The third proposal is the proposed acquisition by Ekovest of at least 51% or more of the issued share capital of Credence Resources Sdn Bhd, which presently holds 63.13% equity interest in IWH, which in turn holds 34.29% equity interest in IWCity.
The purchase consideration payable by Ekovest to the vendors of Credence is proposed to be satisfied via the issuance of new ordinary shares in Ekovest, at the proposed issue price of RM0.60 per new Ekovest share.
The fourth proposal is the proposed merger of the properties and assets of IWH and IWCity into a single entity, through the acquisition by IWCity of the entire issued share capital of all the existing direct subsidiaries of IWH.
The purchase consideration payable by IWCity to IWH is proposed to be satisfied via the issuance of new ordinary shares in IWCity to IWH at the proposed issue price of RM0.80 per new IWCity share.
These various corporate proposals are not intended to be conditional or inter-conditional upon each other, and will be implemented separately and independently, if deemed fit by the board of directors of the respective companies.
Lim said that given the similar core businesses of the companies, the proposals are aimed to consolidate the assets, resources, and capabilities of the respective parties through Ekovest, in order to strengthen the performance, competitiveness and sustainability of the enlarged conglomerate.
After the proposals are completed, Ekovest’s intended corporate structure will be as follows:
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