KUALA LUMPUR (Nov 9): Iris Corp Bhd is disposing of a 75% stake in its Thai unit PJT Technology Co Ltd to Yunnan Water (Hong Kong) Co Ltd for RM103.15 million, as part of plans to unlock the value of assets which are not part of the group’s core business. 

In a filing with Bursa Malaysia today, Iris said it intends to utilise the proceeds raised from the deal to repay its outstanding loan to Standard Chartered Bank Offshore Labuan, while the balance will be retained for working capital.

Iris expects its gearing to fall to 67.1% from 88.6% following the repayment of outstanding loan to the bank and the completion of the proposed disposal based on its latest audited consolidated financial statement.

"The proposed disposal is (also) in line with the group's plan to strengthen its balance sheet," said Iris, adding it will free the group from further investments into its waste-to-energy incinerator in Phuket, Thailand. PJT Technology currently owns and operates a 60 tonnes per day industrial waste-to-energy power plant in Bangkok, Thailand.

Iris and its wholly-owned subsidiary Northern Shine Holdings Ltd had last Friday signed a sale and purchase of shares agreement with Yunnan Water for the disposal of 5.55 million shares or 75% of PJT Technology to the latter. 

Upon the completion of the deal, PJT Technology will cease to be a subsidiary of Iris.

Iris is targeting to complete the deal by Dec 31.

Yunnan Water is a limited company incorporated in 2014 and is a wholly-owned subsidiary of Yunnan Water Investment Co Ltd, a joint stock limited liability company incorporated in China and is listed on the Main Board of Hong Kong Exchanges and Clearing Ltd.

Yunnan Water's principal activity is in sewage disposal projects, supply of running and raw water among other related projects in China.

As at 2.50pm today, shares in Iris were traded up 4.08% at 25.5 sen, with 13.16 million shares done, bringing a market capitalisation of RM510.07 million.

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