Thursday 28 Mar 2024
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KUALA LUMPUR (Sept 18): MMAG Holdings Bhd has acquired a 26.37% stake in listed software solutions provider PanPages Bhd for RM10.25 million or an average price of 14.6 sen per PanPages share.

MMAG said with the acquisition, the group, through its subsidiary Line Clear Express & Logistics Sdn Bhd, can leverage on PanPages' business search platform or database and tap into the customers database by offering its courier and logistics services to all its existing customers.

"Apart from having an extensive nationwide transport or logistics infrastructure, Line Clear will leverage on this opportunity and to monetise its investment so far," it said in a filing with Bursa Malaysia today.

MMAG said it purchased 70 million shares in PanPages today (Sept 18).

The consideration of 14.6 sen per PanPages share represents a 35% discount from the closing price of 22.5 sen on Sept 14, and a 44% discount from the average one-year closing price of PanPages of 26 sen.

"PanPages is planning to develop an e-commerce online restaurant procurement platform called B2B e-Grocery to transform the traditional retail way of doing business for grocery to the e-Grocery way.

"The B2B e-Grocery Platform comprises the online and fulfilment centres which are critical to ensure timely delivery and quality of food ingredients. This will complement Line Clear’s strategic direction of providing cold rooms and the last mile delivery services to all its business partners," MMAG said.

The acquisition in PanPages is expected to contribute positively to MMAG Group, but to mitigate risks, MMAG said the management would try to seek for board representative in PanPages to be involved in the decision making of strategic matters in PanPages.

The acquisition will be satisfied by MMAG’s internal funds and proceeds from conversion of the irredeemable convertible preference shares.

"The acquisition is not expected to have any immediate material effect on the consolidated earnings of MMAG Group for the financial year ending March 31, 2019 as the acquisition is only expected to be completed by this month.

"However, the acquisition is expected to contribute positively to the future earnings of MMAG Group," the group added.

Barring any unforeseen circumstances, MMAG expects the acquisition to be completed this month.

MMAG shares closed down 0.5 sen or 1.82% at 27 sen today, with 321,800 shares done, bringing it a market capitalisation of RM157.87 million. Shares in PanPages ended the day 1.5 sen or 6.67% higher at 24 sen, with 566,400 shares traded, valuing it at RM63.72 million.

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