OCR disposes loss-making subsidiary for RM4.4 mil

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KUALA LUMPUR (April 26): OCR Group Bhd has entered into a share sale agreement with Singaporean Choo Peng Hung to dispose its entire equity stake of 100% in Takaso Industries Pte Ltd (TIPL) for RM4.4 million.

In a bourse filing, the group said there is also an owing amount of RM2.14 million due by TIPL to OCR, bringing the amount repayable to OCR to RM6.54 million, which shall be paid in instalments by the purchaser.

It intends to use the proceeds for working capital purposes.

“TIPL has registered loss after tax of approximately RM1.4 million for the financial year ended July 31, 2017, principally due to a slow down of TIPL’s business that led to reduced sales. The disposal enables OCR to stop consolidating TIPL’s losses into the group’s income statements subsequent to the completion of the disposal.

“The disposal also enables OCR to concentrate on its existing business of property development and construction business,” said the group.

OCR said it does not expect the disposal to have a material impact on its net assets per share, earnings per share or gearing.

The group expects to complete the disposal within three months from the date of the agreement.

OCR closed unchanged at 42 sen a share, giving the group a market capitalisation of RM122.81 million.