KUALA LUMPUR (April 27): Construction firm Pesona Metro Holdings Bhd (Pesona Metro) is planning on acquiring a 90% equity interest in Selasih Asli Sdn Bhd (SASB), the potential concessionaire for the development and maintenance of student hostels in Peninsula Malaysia, for RM60 million.

Based on a filing with Bursa Malaysia, Semarak Korporat Sdn Bhd (SKSB), who is SASB’s parent company, is in the midst of negotiating with relevant parties for SASB to enter into a concession agreement.

SASB itself was set up for the purpose of entering into a concession agreement with relevant authorities for the design, development and maintenance of student hostels at a tertiary level institution.

However, SASB has not commenced operations since its incorporation and details of the said concession will only be announced after a concession agreement is signed.

Pesona Metro said: “With the award of the concession to SASB, the proposed acquisition represents a strategic investment for Pesona Metro, as it will benefit from development and design of student hostels.”

It added the purchase consideration would be satisfied with RM3 million in cash, and the remainder with the allotment of and issuance of new Pesona Metro shares. The price of the new Pesona Metro shares will only be determined later.

Pesona Metro (fundamental: 1.8; valuation 0.5) plans to close the deal with SKSB — SASB’s parent company — by the first quarter of 2016. The company will still require approvals from regulators and its own shareholders for the acquisition.

The company's share price closed 2 sen lower at 92 sen, giving it a market capitalisation of RM481.12 million.

(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)